State of Hawaii Department of Taxation

RELEASE DATE: July 2, 2026

REQUEST FOR PROPOSALS

No. RFP-27-TAX-01

SEALED OFFERS

FOR

Out-of-State Lien Enforcement Services for the State of Hawaii Department of Taxation

The Department of Taxation, Administrative Services Office, would like to solicit offers for Out-of-State Lien

Enforcement Services through the Hawaii State eProcurement System (HIePRO). Offers shall be received via HIePRO.

HIePRO offers will be received up to 4:00 P.M. Hawaii Standard Time on August 14, 2026 and must be submitted in strict accordance with the instructions herein.

Questions shall be submitted via HIePRO by the Question-and-Answer Deadline.

Min Meng Administrative Services Officer State of Hawaii Department of Taxation Administrative Services Office

TABLE OF CONTENTS

Page

SECTION ONE: INTRODUCTION, TERMS, ACRONYMS AND KEY DATES 3

SECTION TWO: BACKGROUND AND SCOPE OF WORK ____________________ 7

SECTION THREE: PROPOSAL FORMAT AND CONTENT _____________________ 19

SECTION FOUR: EVALUATION CRITERIA ________________________________ 27

SECTION FIVE: CONTRACTOR SELECTION AND CONTRACT AWARD 29

SECTION SIX: SPECIAL PROVISIONS _________________________________ 34

SECTION SEVEN: ATTACHMENTS AND EXHIBITS __________________________ 36

• Attachment 1: OFFER FORM, OF-1

• Exhibit A: GENERAL PROVISIONS FOR GOODS AND SERVICES

• Exhibit B: OVERVIEW OF THE RFP PROCESS

SECTION ONE

INTRODUCTION, TERMS AND ACRONYMS, KEY DATES

1.1 INTRODUCTION

The State of Hawaii Department of Taxation (DOTAX) is requesting proposals from interested law firms to provide Out-of-State Lien Enforcement Services for DOTAX.

Any award will result in a contract for these services for use by DOTAX.

This request for proposals (RFP) is issued under the provisions of the Hawaii Revised Statutes (HRS), Chapter 103D, its administrative rules, and is for services pursuant to HRS section 231-13.

1.2 CANCELLATION

The RFP may be cancelled and any or all proposals rejected in whole or in part, without liability to the State, when it is determined to be in the best interest of the State.

1.3 TERMS AND ACRONYMS USED THROUGHOUT THE SOLICITATION

BAFO = Best and Final Offer

CPO = Chief Procurement Officer

Director

Director, Department of Taxation

DOTAX = Department of Taxation GC = General Conditions issued by Department of the

Attorney General GET = General Excise Tax

HAR

Hawaii Administrative Rules

HRS = Hawaii Revised Statutes

Offeror

Any individual, partnership, firm, corporation, joint venture, or other legal entity, submitting directly or through a duly authorized representative or agent, an offer for the work or services contemplated in response to this RFP. Following an award made pursuant to the terms of this RFP and the execution of a contract with DOTAX pursuant to the terms hereof, any Offeror shall be deemed to be a Contractor and any and all references herein to Offeror shall be deemed to be references to Contractor for the purposes of the Contract executed hereunder, including, without limitation, any and all rights and obligations set forth herein.

Procurement Officer

= The contracting officer for the State of Hawaii, Department of Taxation

RFP = Request for proposals

State = State of Hawaii, including its departments, agencies, and political subdivisions

STC = State Tax Collector

1.4 RFP SCHEDULE AND SIGNIFICANT DATES

The below RFP Schedule and Significant Dates (the “schedule”) represents the State’s best estimate of the schedule that will be followed for this procurement. All times indicated are Hawaii Standard Time (HST). If a component of this schedule, such as "Proposals Due Date/Time" is delayed, the rest of the schedule will likely be shifted by the same number of days. Any change to the schedule shall be made through a properly executed addendum. The approximate schedule is as follows:

Release of Request for Proposals July 02, 2026 Due Date to Submit Questions July 17, 2026 State’s Response to Questions July 31, 2026 Proposals Due Date/Time August 14, 2026 at 4 p.m. (HST)

Notice of Award Due Date/Time August 28, 2026 at 4 p.m. (HST)

Contract Start Date October 01, 2026

1.5 QUESTIONS AND ANSWERS PRIOR TO OPENING OF PROPOSALS

All questions shall be submitted via HIePRO by the due date specified in Section 1.4, RFP Schedule and Significant Dates, and as may be amended by a properly executed addendum.

The State will respond to questions via HIePRO by the date specified in Section 1.4, RFP Schedule and Significant Dates, and as may be amended by a properly executed addendum.

1.6 STATE POINT OF CONTACT

For questions relating to the proposal submittal or general contract-related questions:

MIN MENG

Administrative Services Officer State of Hawaii Department of Taxation Administrative Services Office 830 Punchbowl Street, Room 217 Honolulu, HI 96813 Phone: (808) 587-1500 Fax: (808) 587-1506

For questions relating to out-of-state lien enforcement service-related questions:

DONGYAN WEN

State Tax Collector State of Hawaii Department of Taxation 830 Punchbowl Street, Room 203 Honolulu, HI 96813 Phone: (808) 543-6820 ext. 4000 Fax: (808) 587-1720

SECTION TWO

BACKGROUND AND SCOPE OF WORK

2.1 PROJECT OVERVIEW AND HISTORY

The purpose of this RFP is to solicit proposals from interested law firms to enforce collection of past due State taxes, penalties, interest, fees, and other obligations from out-of-state delinquent taxpayers. The goal of procuring the services of a law firm to conduct out-of-state lien enforcement services is to assist DOTAX in reducing the inventory of past due accounts and delinquent State of Hawaii taxes and collect revenue for the General Fund of the State of Hawaii. The successful Offeror (hereafter “Contractor”) will collect the amounts owed to the State on a contingency fee basis under section 231-13, Hawaiʻi Revised Statutes (HRS), and also be required to keep and maintain records of all assigned accounts and to provide status reports of these accounts. The State shall not be responsible for any attorney fees, costs, or other expenses payable to the Contractor other than a contingency fee. Delinquent accounts referred will include, but are not limited to, non-Hawaii-domiciled taxpayers with tax liabilities owing to the State.

2.1.1 COMPENSATION

The Contractor shall propose a fee schedule based on paragraph 2.2.1 below and shall specify the fee payment from amounts collected. Pursuant to section 443B- 19(4), HRS, the Contractor shall not retain statutory interest that accrues on delinquent tax accounts after the accounts are referred to the Contractor for collection.

2.2. SCOPE OF WORK

All services provided by the Contractor shall be in accordance with this RFP, including its attachments and any addenda.

2.2.1 Matters Referred for Collection

As of April 30, 2026, DOTAX currently has approximately $373 million in potentially collectible delinquent taxes that comprise of unpaid accounts owed by out-of-state taxpayers. DOTAX will refer at its discretion for collection past due, unpaid accounts of delinquent taxpayers of the State of Hawaii, including but not limited to accounts with various outstanding balances and existing cases that DOTAX staff is unable to pursue. DOTAX will provide a notification letter to the taxpayers whose accounts will be referred to the Contractor.

The Contractor shall identify accounts that are not collectible based on criteria provided in sections 231-32 or 40-82, HRS, and transmit the information to the State Tax Collector in written and electronic format. If a taxpayer’s payment consists of funds that have been offset by DOTAX or the Federal Government, the Contractor will not be credited for collection of these "offset" amounts and will not receive a contingency fee based on said "offset" amounts.

In cases where taxpayer information is found to be incorrect, the Contractor must notify the State Tax Collector of the inaccurate information by written and electronic format as soon as possible and provide the State Tax Collector with the correct information, if known.

2.2.2 Data Transmittal

The Contractor must establish fully tested, automated data exchange infrastructure to support the following daily and weekly file transmissions, each requiring end-to-end validation before go-live. DOTAX will establish the secured connection for electronic communication and data/information exchange. Contractor may propose an alternative secured connection which DOTAX will review and, if acceptable, approve for electronic communication and data/information exchange.

1. Daily Referral and Collection Update File

A structured flat file transmitted each business day containing all active referred collections, balance updates, taxpayer address changes, and case status changes. The Contractor must ingest, parse, and reconcile this file against their internal systems.

2. Weekly Incoming Payment File (Tuesdays)

The Contactor must transmit a payment file each Tuesday (or next business day if a holiday), accompanied by a simultaneous ACH deposit to the DOTAX bank account. File totals must match deposit amounts to the penny for reconciliation.

3. Monthly Fee Summary File

A detailed fee file generated at revenue period close will be transmitted via SFTP, itemizing all fees collected by DOTAX on referred debt. The Contactor must confirm receipt and reconcile against their own records monthly.

4. Daily Fee File

Generated on days DOTAX receives payments on referred debt; the Contactor must receive and acknowledge this file but understand it is not the file of record for reconciliation.

2.2.3 Control over Accounts

DOTAX shall retain control over the accounts referred to Contractor. DOTAX may recall, at its discretion, any account referred to the Contractor at any time without charge or penalty.

2.2.4 Power to Negotiate

Unless authorized in writing by DOTAX, Contractor shall not have the power to negotiate with taxpayers to settle accounts for less than amounts referred by

DOTAX.

2.2.5 Installment Agreements

Unless authorized in writing by DOTAX, Contractor shall not have the power to negotiate Installment Agreements with taxpayers to settle accounts referred by

2.2.6 Account Records

Contractor shall adjust the records of the referred accounts upon any modification of information transferred by DOTAX.

2.2.7 Collections Techniques

Contractor will use accepted skip tracing and collection techniques to locate delinquent taxpayers. Techniques shall include the capability to pursue delinquent taxpayers residing within the boundaries of the United States, including military bases and Indian Reservations, or in foreign countries.

The Contractor shall comply with the Fair Debt Practices Collection Act and other applicable laws, including State and Federal laws governing confidentiality and privacy of taxpayer information, and chapters 487J and 487N, HRS. The Contractor shall be knowledgeable in other jurisdictions' fair debt law, disclosure law and other applicable laws. The Contractor shall not use any means in violation of any laws, including section 480D-3, HRS. The Contractor shall work with the State Tax Collector to provide communications and public relations support to address any questions or concerns related to the services and activities identified in this

RFP.

2.2.8 Payment Process on Accounts Referred to Contractor.

The Contractor shall have the capability to collect payments on all accounts referred by DOTAX. Payments received by the Contractor, less authorized contingency fees, shall be transmitted to the DOTAX-designated bank account via ACH deposit within the timeframe specified by DOTAX.

The Contractor shall record detailed payment information for each transaction, including but not limited to the account identifier, payment amount, date of payment, and any applicable fees. This information shall be transmitted to DOTAX in a format and frequency approved by DOTAX to ensure accurate posting and reconciliation.

Payment for all accounts referred to Contractor may also be processed through Hawaii Tax Online.

2.2.9 Inspection of Records

Contractor shall maintain and make available for inspection, audit, and reproduction to authorized personnel of DOTAX any books, documents, electronic information, recordings, correspondences, or other relevant information pertaining to collections performed.

2.2.10 Return of Uncollectible Accounts

Contractor shall promptly return to DOTAX any and all assigned accounts that remain uncollected at the end of the Contract period. Contractor shall document all efforts taken to collect on the assigned accounts and the reasons that the assigned accounts remain uncollected.

2.2.11 Turnover and Return of Taxpayer Information

Contractor shall provide any and all available information on the delinquent taxpayer that pertains to the outstanding debt within one week when requested by DOTAX or within 30 days after the termination or expiration of the Contract period.

This information includes, but is not limited to, the amount of the delinquency, the taxpayer's address, recording, correspondences, any relevant information pertaining to the collections performed, etc.

The Contractor and its subcontractors, employees and agents shall return all hardcopy tax documents and information, if any, to DOTAX at termination or conclusion of the Contract.

Upon termination or expiration of the Contract pursuant to this RFP, all taxpayer information acquired pursuant to the work under this RFP stored electronically or otherwise shall be retained for a period of three (3) years in a secure manner. At the completion of those three (3) years, the electronic information, shall be permanently deleted from all of the Contractor’s servers and other electronic storage media, including portable computers and devices, in a manner DOTAX has approved in writing with written certification of compliance with this provision being provided to DOTAX within three years (3) and thirty (30) days of the termination or expiration of the Contract. The failure to provide the certification within the 30-days constitutes breach of the Contract for which the State would be entitled to all available remedies.

2.2.12 Payments Received by DOTAX

In the event a taxpayer makes a payment directly to DOTAX to pay an obligation that had been declared delinquent and turned over to Contractor, DOTAX will accept the payment and Contractor shall be entitled to a fee for that payment if DOTAX determines, in its sole discretion, that the payment resulted from the Contractor's collection efforts.

The Contractor shall not be entitled to a fee for any case that has not been referred for collection, any case which has been referred to the Contractor for collection and returned to DOTAX for any reason, any payment made directly to DOTAX that was not due to the Contractor's collection efforts, any case where a recovery is made through the set-off of any unpaid debt by a federal or state refund intercept, or any case that has been referred to the Attorney General for collection. The State Tax Collector will inform the Contractor and the Contractor shall reduce the account balance by the amount collected.

2.2.13 Federal Tax Refund Intercept Program

In the event an account balance that has been turned over to Contractor is reduced by a federal tax refund intercept, the State Tax Collector will inform the Contractor and Contractor shall reduce the account balance and the intercepted amount shall not be included in calculating the Contractor’s compensation.

2.2.14 Payments Received Due to Bankruptcy

In the event that Contractor learns that a taxpayer whose account has been referred to Contractor has filed for bankruptcy, Contractor shall immediately cease collection efforts and the account shall be returned to the State Tax Collector.

In the event an account balance that has been turned over to Contractor is reduced by a payment received through a bankruptcy proceeding, Contractor shall reduce the account balance and the amount of the payment received as a result of a bankruptcy proceeding shall not be included in calculating the Contractor's compensation.

2.2.15 Claims and Complaints

The Contractor shall track and immediately inform the State Tax Collector in writing, of any complaints, lawsuits, claims, demands, counterclaims, and third-party complaints by a taxpayer against the Contractor, DOTAX and/or State of

Hawaii. D O T A X a n d t h e State of Hawaii are not responsible for the defense or indemnity of the Contractor regarding any complaints or claims against the Contractor, DOTAX and/or State of Hawaii.

2.2.16 Personnel and Labor

The Contractor shall furnish all equipment, personnel, labor, and materials necessary to provide DOTAX with collection services for its delinquent tax accounts in accordance with the terms and conditions of the Contract, the RFP and any addenda.

The Contractor shall strive to limit, as much as reasonably possible, the demands placed upon DOTAX staff in support of the Contractor’s work.

The Contractor shall ensure that the Contractor’s employees or agents are experienced and fully qualified to engage in the activities and to perform the services required under the Contract, and that all applicable licensing and operating requirements imposed or required under federal, state, or county law, and all applicable accreditation and other standards of quality generally accepted in the field of the activities of such employees and agents are complied with and satisfied. Criminal background check of each employee and agent will be required at Contractor's expense.

2.2.17 Procedures, Formats, Designs

Upon the execution of a contract, the Contractor shall provide specific procedures, report formats, notice and or collection demand designs, and samples of correspondence, or any other items upon request by DOTAX for review.

2.2.18 Contractor Responsiveness

The Contractor shall respond to inquiries from DOTAX on the referred accounts within five (5) business days.

2.2.19 Subcontractors

Contractor shall provide a list of any subcontractors who will be used to perform a portion of the services required herein, together with a description of the subcontractor's duties and an acknowledgement by the subcontractor of its duties under the Contract. Subcontractors shall be subject to the same security, confidentiality, due diligence and related performance requirements as the Contractor. Use of any subcontractors shall be subject to DOTAX's written consent.

The Contractor shall be the sole point of contact with regard to all contractual matters, including payment for any and all charges resulting from the Contract, and shall be responsible for all services.

2.2.20 Training and Technical Assistance

If requested, the Contractor shall provide information on training and technical assistance on the best practices and utilization of third-party tax collection.

2.2.21 On-Going Monitoring of Staff and Performance Evaluation

The Contractor shall ensure an ongoing monitoring system to ensure high quality outcomes. All phone calls must be recorded, and Contractor shall inform the taxpayer or any third party that their phone calls are being recorded. DOTAX shall have unrestricted access to all phone calls and recordings, at the Contractor’s expense. The Contractor must be able to identify the specific employee, by name, responsible for each phone call. If requested, the Contractor shall provide phone calls and recordings and relevant copies of employee performance evaluations.

2.2.22 Support to DOTAX

DOTAX is seeking a Contractor who shall support its mission to administer the tax laws of the State of Hawaii in a f a i r , u n i f o r m , a n d consistent, manner.

The Contractor shall conduct business in a way that is sensitive to the community and culture of Hawaii. The Contractor shall be professional and respectful to both taxpayers and DOTAX’s employees.

2.2.23 Returns and Return Information

The Contractor and its subcontractors, employees, and agents shall be responsible for the security and confidentiality of any and all state and federal tax documents and tax return information as defined in Internal Revenue Code ("IRC") section 6103. The Contractor and its subcontractors, employees, and agents fully understand it is unlawful to make known information provided by DOTAX, including, but not limited to, information imparted by any state or federal tax return or estimate so made or to permit tax information, including, but not limited to, information imparted by any tax return or record to be seen or examined by any unauthorized person or to make copies of tax information under either the IRC of 1986, as amended (26 U.S.C.), or under sections 235-116, 237-34, HRS, and other provisions of Hawaii law. Any breach of this provision shall be cause for termination of this Agreement and shall subject the Contractor, its employees, agents, and subcontractors to punishment or prosecution as provided by federal and state law.

Before beginning work, the Contractor, its agents, employees and any subcontractors or their employees and agents shall be required to sign a confidentiality agreement, as provided by DOTAX and provide information and evidence of security training compliance and background checks of employees and agents that will access tax information

2.2.24 Electronic Transmission

Any and all confidential taxpayer information transmitted between DOTAX, and the Contractor will be exchanged on a secure connection pursuant to paragraph 2.2.2.

No confidential taxpayer information from DOTAX will be electronically transmitted via e-mail or facsimile (fax) between DOTAX and the Contractor and any outside specialists or other entities engaged by either party.

2.2.25 Output and Performance/Outcome Measurements

The Contractor shall provide monthly reports that document interactions with taxpayers that include, but are not limited to, time, location, people in attendance, summary of exchange, etc.

The Contractor shall provide meeting minutes of meetings with DOTAX.

All reports shall be provided in electronic format and available through a secure online web portal provided by the Contractor.

2.2.26 Experience

The Contractor shall have a minimum of seven (7) years of licensed, debt collection experience. Contractor shall be compliant with all state and federal laws of the jurisdictions within which the Contractor is conducting its business.

2.2.27 Project Manager

The Contractor shall maintain open lines of communication for the purpose of managing the collection program, resolving problems, and promoting understanding. The Contractor shall designate a project manager and alternate manager to meet, as requested, with DOTAX personnel to discuss Contractor services.

2.2.28 Reporting Requirements for Program and Fiscal Data

The Contractor shall provide reports as deemed necessary by DOTAX. DOTAX shall have unlimited rights to the use of all the Contractor's reports, statistical data, and notes. Reports shall be provided in electronic format and through a secure, online web portal provided by the Contractor.

2.2.29 Monthly Reports

The Contractor shall maintain the following reports and upon DOTAX request provide access to the Contractor's client portal to access/generate these reports on demand with specific time periods. If requested, the Contractor shall provide these reports in Excel or CVS format.

1. Terminated or Returned Accounts Report

All accounts that have been closed or returned, including uncollected accounts.

2. Collections on Accounts Report

All accounts for which money has been received by the Contractor for the month. The Contractor shall organize the report by debtor name and last four digits of the taxpayer's tax identification number, location, debt amount, tax/period/age of the debt, the amount collected (month-to-date, fiscal year to date, cumulatively), and the date of assignment from DOTAX.

3. Monthly Summary Reports

A monthly accounting of the status of all accounts in the Contractor’s possession and tax period/age of the accounts as of the reporting month, including identification of all accounts on some form of installment payment.

2.2.30 Contractor’s Automated System

The Contractor shall have an automated system to facilitate the exchange of account referrals, updates, retractions, payment information, and status reports.

The Contractor must have the technological capabilities to maintain adequate communication with DOTAX and the public. The Contractor shall provide secured access for online inquiry from DOTAX to the Contractor’s automated system. The Contractor must be capable of providing monthly status updates, performance metrics, and discussions with DOTAX providing progress and feedback on individual accounts.

The Contractor shall provide disaster preparedness and adequate computer back-up systems and procedures to accommodate equipment failure. The back-up systems must capture and preserve all data necessary to ensure the accurate accounting of money collected and to create all mandated reports.

The Contractor shall provide to DOTAX the location of the office or offices where the database containing DOTAX data will be located and the names and location of the programmers and network administration staff that will have access to the data. All Contractor employees must agree to a background check if requested by

2.2.31 Data Security

The Contractor shall implement and maintain administrative, technical, and physical safeguards to ensure the confidentiality, integrity, and availability of all DOTAX data provided to, collected by, or otherwise accessed by the Contractor.

These safeguards shall, at a minimum, meet all applicable State of Hawai‘i information security standards and industry-accepted best practices.

The Contractor shall:

1. Maintain secure systems and access controls to prevent unauthorized use, disclosure, modification, or destruction of DOTAX data.

2. Ensure all data transmissions between the Contractor and DOTAX use encrypted channels and protocols approved by DOTAX.

3. Restrict access to DOTAX data to authorized personnel only, based on the principle of least privilege, and maintain auditable access logs.

4. Implement data loss prevention measures, including secure storage, backup, and recovery processes, consistent with State requirements.

5. Maintain procedures for monitoring, detecting, and responding to security incidents and potential breaches. The Contractor shall notify DOTAX immediately of any actual or suspected security incident involving DOTAX data and shall fully cooperate with DOTAX in investigation and remediation activities.

6. Ensure that all subcontractors or third parties engaged by the Contractor who may access DOTAX data comply with the same security requirements set forth in this section.

7. Prevent the use, reproduction, modification, distribution, or disclosure of DOTAX data for any purpose other than fulfilling the Contractor’s obligations under this contract.

All security controls, processes, and system configurations related to DOTAX data are subject to review and approval by DOTAX. DOTAX may request documentation, audit results, or demonstrations of compliance at any time.

2.2.32 Testing Requirements

Prior to the initiation of any live debt referrals, the Contractor shall successfully complete a comprehensive testing program in collaboration with DOTAX technical staff. The testing program shall verify the Contractor’s ability to correctly send, receive, and process all required data exchanges.

At a minimum, the testing shall include all file exchanges described in Section

2.2.30 and must demonstrate accurate formatting, data integrity, secure transmission, and end‑to‑end system compatibility. Additional testing scenarios may be required at DOTAX’s discretion to ensure full operational readiness.

2.2.33 Testing Requirements – Timeline

The Contractor shall complete all implementation activities and successfully finish the full testing program within three (3) calendar months from the date of contract execution. This timeline includes system configuration, data exchange setup, internal testing, user acceptance testing, and any remediation required to achieve full compliance.

2.2.34 Operational Support

The Contractor shall assign dedicated technical staff capable of diagnosing and resolving file transmission errors, payment allocation discrepancies, and fee calculation anomalies in coordination with DOTAX developers.

The Contractor shall participate in periodic reconciliation reviews, including verification of fee postings across all active collections, using State-provided audit and reconciliation tools.

The Contractor shall perform specialized processing for bankruptcy cases, new debt added to existing collections, lien creation work items, and accounts containing deceased taxpayer indicators, each of which follows distinct workflows within the DOTAX system.

2.3 DOTAX RESPONSIBILITIES

(1) State Tax Collector will refer at its discretion for collection past due, unpaid accounts of delinquent taxpayers of the State of Hawaii, including but not limited to accounts with various outstanding balances and existing collection cases and matters.

The amounts for collection include taxes, penalties, interest, fees, and other obligations owed by the delinquent taxpayers.

(2) State Tax Collector will identify an employee or employees to whom the Contractor shall provide any accountings or reports pursuant to Section 2 of this RFP.

(3) State Tax Collector shall inform the Contractor whenever it receives a payment for the taxpayer on any referred account.

2.4 TERM OF CONTRACT

The contract shall be for a period of twelve (12) months beginning on the date on the Notice to Proceed issued by DOTAX.

Unless terminated, the Contractor and DOTAX may extend the Contract for not more than two (2) additional twelve (12) month periods without the necessity of rebidding at current contract rates upon mutual agreement in writing at least sixty

(60) days prior to the expiration of the Contract. The Contract price or commission paid to the Contractor for the extended period shall remain the same or as described in the Contractor’s proposal to this RFP.

When interests of the State so require, DOTAX may terminate the Contract for convenience by providing six (6) weeks prior written notice to the Contractor.

SECTION THREE

PROPOSAL FORMAT AND CONTENT

3.1 OFFEROR’S AUTHORITY TO SUBMIT AN OFFER

The State will not participate in determinations regarding an Offeror's authority to sell a product or service. If there is a question or doubt regarding an Offeror's right or ability to obtain and sell a product or service, the Offeror shall resolve that question prior to submitting an offer.

Furthermore, all Offerors must provide three (3) years audited financial statements to DOTAX with their proposal. Each Offeror must also be in compliance with their tax obligations to the State of Hawaii by providing a tax clearance certificate current within six (6) months of the submission of its proposal.

3.2 REQUIRED REVIEW

3.2.1 Before submitting a proposal, each Offeror must thoroughly and carefully examine this RFP, any attachments, addenda, and other relevant documents, to ensure Offeror understands the requirements of the RFP.

Offeror must also become familiar with state, local, and federal laws, statutes, ordinances, rules, and regulations that may in any manner affect cost, progress, or performance of the work required, including professional or vocational licensing requirements in any state where collection activity is conducted.

3.2.2 Should Offeror find defects and questionable or objectionable items in the

RFP, Offeror shall notify DOTAX in writing prior to the deadline for written questions as stated in the RFP Schedule and Significant Dates, as amended. E-mail shall be considered "in writing." This will allow the issuance of any necessary corrections and/or amendments to the RFP by addendum and mitigate reliance of a defective solicitation and exposure of proposal(s) upon which award could not be made.

3.3 PROPOSAL PREPARATION COSTS

Any and all costs incurred by the Offeror in preparing or submitting a proposal shall be the Offeror’s sole responsibility whether or not any award results from this RFP.

The State shall not reimburse such costs.

3.4 TAX LIABILITY

3.4.1 Work to be performed under this solicitation is subject to the provisions in

Chapter 237 HRS, and if applicable, Chapter 238. Contractor is advised that Contractor is liable for the Hawaii GET at the current rate of 4%, plus any applicable county surcharge, unless exempt by law. If Offeror is a person exempt by the HRS from paying the GET, and therefore not liable for the taxes on this solicitation, Offeror shall state its tax-exempt status and cite the HRS chapter or section allowing the exemption.

3.4.2 Offeror shall submit its current Federal I.D. No. and Hawaii General Excise

Tax License I.D. number in the space provided on Offer Form, page OF-1, thereby attesting that the Offeror is doing business in the State and that Offeror will pay such taxes on all business transaction in the State.

3.5 PROPERTY OF STATE

All proposals become the property of the State of Hawaii.

3.6 CONFIDENTIAL INFORMATION

3.6.1 If an Offeror believes that any portion of a proposal, offer, specification, protest, or correspondence contains information that should be withheld from disclosure as confidential, then the Offeror shall inform the Procurement Officer named on the cover of this RFP in writing and provide with sufficient justification to support the Offeror’s confidentiality claim. Price is not considered confidential and will not be withheld.

3.6.2 An Offeror shall request in writing nondisclosure of information such as designated trade secrets or other proprietary data Offeror considers to be confidential. Such requests for nondisclosure shall accompany the proposal, be clearly marked, and shall be readily separable from the proposal in order to facilitate eventual public inspection of the non-confidential portion of the proposal.

3.7 EXCEPTIONS

Should Offeror take any exception to the terms, conditions, specifications, or other requirements listed in the RFP, Offeror shall list such exceptions in the Exceptions section of the Offeror's proposal. Offeror shall reference the RFP section where exception is taken, a description of the exception taken, and the proposed alternative, if any. The State reserves the right to accept or not accept any exceptions.

No exceptions to statutory requirements of the AG General Conditions shall be considered or incorporated into the Offeror’s proposal or Contract.

3.8 PROPOSAL OBJECTIVES

3.8.1 One of the objectives of this RFP is to make proposal preparation easy and efficient, while giving Offerors ample opportunity to highlight their proposals.

The evaluation process must also be manageable and effective.

3.8.2 Proposals shall be prepared in a straightforward and concise manner, in a format that is reasonably consistent and appropriate for the purpose.

Emphasis will be on completeness and clarity and content.

3.8.3 When an Offeror submits a proposal, it shall be considered a complete plan for accomplishing the tasks described in this RFP and any supplemental tasks the Offeror has identified as necessary to successfully complete the obligations outlined in this RFP.

3.8.4 The proposal shall describe in detail the Offeror’s ability and availability of services to meet the goals and objectives of this RFP as stated in Section

2.2 SCOPE OF WORK.

3.8.5 Offeror shall submit a proposal that includes an overall strategy, timeline and plan for the work proposed as well as expected results and possible shortfalls.

3.9 PROPOSAL FORMS

3.9.1 To be considered responsive, the Offeror’s proposal shall respond to and include all items specified in this RFP and any subsequent addendum. Any proposal offering any other set of terms and conditions that conflict with the terms and conditions provided in the RFP or in any subsequent addendum may be rejected without further consideration.

3.9.2 Offer Form, Page OF-1 Offer Form OF-1 is required to be completed using

Offeror’s exact legal name as registered with the Department of Commerce and Consumer Affairs, State of Hawaii, if applicable, in the appropriate space on Offer Form, OF-1 (SECTION SEVEN, Attachment 1). Failure to do so may delay proper execution of the Contract.

The Offeror’s authorized signature on the Offer Form, OF-1 shall be an original signature in ink, which shall be required before an award, if any, can be made. The submission of the proposal shall indicate Offeror’s intent to be bound.

3.9.3 Offer Form, Page OF-1. Pricing shall be submitted on Offer Form OF-1

(SECTION SEVEN, Attachment 1). The price shall be the all-inclusive cost, including the GET, to the State. No other costs will be honored. Any unit prices shall be inclusive.

3.10 PROPOSAL CONTENTS

Proposals must:

3.10.1 Include a transmittal letter to confirm that the Offeror shall comply with the requirements, provisions, terms, and conditions specified in this RFP.

3.10.2 Include a signed Offer Form OF-1 with the complete name and address of Offeror’s firm and the name, mailing address, telephone number, and fax number of the person authorized to sign on behalf of the Offeror.

3.10.3 If subcontractor(s) will be used, append a statement to the transmittal letter from each subcontractor, signed by an individual authorized to legally bind the subcontractor and stating:

a. The general scope of work to be performed by the subcontractor;

b. The subcontractor’s willingness to perform.

3.10.4 Provide all of the information requested in this RFP in the order specified.

3.10.5 Be organized into sections, following the exact format using all titles, subtitles, and numbering, with tabs separating each section described below. Each section must be addressed individually and pages must be numbered.

a. Transmittal Letter

See SECTION SEVEN, Attachment 1, Offer Form OF-1.

b. Experience and Capabilities.

1) The number of years Offeror has been in business and the number of years Offeror has performed services specified by this RFP.

2) A summary of the law firm.

3) The name, business address, and telephone number of the individual that will act as the contact person, and (1) the number of attorneys employed by the law firm; and (2) the number of staff and other non-attorney employees employed by the law firm.

4) The years of experience the Offeror has in collections of unpaid debts.

5) The Offeror's experience with municipal, local, or state government debt collection issues. Offeror must include the number of municipal, local, or state government clients, the information on the dollars collected and the success rate.

6) A copy of applicable licenses and certifications.

7) A list of key personnel and associated resumes for those who will be dedicated to this project.

8) A list of at least three (3) references from the Offeror's client listing that may be contacted by the State as to the Offeror's past and current job performance. Offeror shall provide names, titles, organizations, telephone numbers, email and postal addresses. If Offeror has any experience in the collection of municipal, local, or state government accounts, please include a list of all of those municipal, local, or state government accounts and include a contact person for each

9) A summary listing of judgments or pending lawsuits or actions against; adverse contract actions, including termination(s), suspension, imposition of penalties, or other actions relating to failure to perform or deficiencies in fulfilling contractual obligations against your firm. If none, so state.

10) The number of all contracts for municipal, local, or state government accounts terminated or not renewed during the last three (3) years, and the reasons for termination.

11) The number of all contracts for municipal, local, or state government accounts that have been renewed within the last three (3) years.

12) Copies of any training manuals or audio and or visual instruction materials used in training.

13) Description and summary of Offeror’s compliance with federal and state laws with respect to confidential taxpayer information and returns, including compliance to Internal Revenue Service’s Publication 1075.

14) A description and summary of Offeror’s technology capabilities including descriptions of the following:

o Summary of the computer system that will maintain the information of accounts;

o Back-up systems and disaster recovery procedures.

15) Offeror shall indicate its work plan and methods, including descriptions of the following:

o Summary of proposed collection activities (use examples of collection letters, telephone contacts, skip trace techniques, day and evening collection staff, etc. and explain how efforts differ between newly delinquent and aged debt);

o Provide sample letters to be sent to delinquent accounts;

o Details of the Offeror's methodology for handling taxpayers' questions, problems, and disputes;

o Details of the Offeror's methodology for handling non- English speaking debtors, the hearing impaired, or blind taxpayers.

c. Proposal including an overall strategy, timeline, and plan.

d. Pricing proposal. O f f e r o r s h a l l collect the amounts owed to the

State on a contingency fee basis. Offeror shall indicate the proposed contingency fee that it will be entitled to for amounts collected under the Contract.

e. Exceptions.

3.11 RECEIPT AND REGISTER OF PROPOSALS

Offers shall be received via HIePRO. Only offers received by the deadline will be considered.

The register of proposals and proposals of the Offeror(s) shall be open to public inspection upon posting of award pursuant to section 103D-701, HRS.

3.12 BEST AND FINAL OFFER (BAFO)

If DOTAX determines a BAFO is necessary, it shall request one from the priority listed Offeror(s). Any BAFO received after the deadline shall not be considered.

3.13 MODIFICATION PRIOR TO SUBMITTAL DEADLINE OR WITHDRAWAL OF

OFFERS

3.13.1 The Offeror may modify or withdraw a proposal before the proposal due date and time.

3.13.2 Any change, addition, deletion of attachment(s) or data entry of an offer may be made prior to the deadline for submittal of offers.

3.14 MISTAKES IN PROPOSALS

3.14.1 Mistakes shall not be corrected after award of contract.

3.14.2 When the Procurement Officer knows or has reason to conclude before award that a mistake has been made, the Procurement Officer should request the Offeror to confirm the proposal. If the Offeror alleges mistake, the proposal may be corrected or withdrawn pursuant to this section.

3.14.3 Once discussions are commenced or after best and final offers are requested, any priority-listed Offeror may freely correct any mistake by modifying or withdrawing the proposal until the time and date set for receipt of best and final offers.

3.14.4 If discussions are not held, or if the best and final offers upon which award will be made have been received, mistakes shall be corrected to the intended correct offer whenever the mistake and the intended correct offer are clearly evident on the face of the proposal, in which event the proposal may not be withdrawn.

3.14.5 If discussions are not held, or if the best and final offers upon which award will be made have been received, an Offeror alleging a material mistake of fact which makes a proposal non-responsive may be permitted to withdraw the proposal if: the mistake is clearly evident on the face of the proposal but the intended correct offer is not; or the Offeror submits evidence that clearly and convincingly demonstrates that a mistake was made.

Technical irregularities are matters of form rather than substance evident from the proposal document, or insignificant mistakes that can be waived or corrected without prejudice to other Offerors; that is, when there is no effect on price, quality, or quantity. If discussions are not held or if best and final offers upon which award will be made have been received, the Procurement Officer may waive such irregularities or allow an Offeror to correct them if either is in the best interest of the State. Examples include the failure of an Offeror to: return the number of signed proposals required by the request for proposals; sign the proposal, but only if the unsigned proposal is accompanied by other material indicating the Offeror’s intent to be bound; or to acknowledge receipt of an amendment to the request for proposal, but only if it is clear from the proposal that the Offeror received the amendment and intended to be bound by its terms;

or the amendment involved had no effect on price, quality or quantity.

SECTION FOUR

EVALUATION CRITERIA

Evaluation criteria and the associated points are listed below. The award will be made to the responsible Offeror whose proposal is determined to be the most advantageous to the State based on the evaluation criteria listed in this section.

Experience and Capability of the Offeror

25 Points

Offeror demonstrates a thorough understanding of the purpose and scope of the requested services

Offeror demonstrates skills, abilities and knowledge related to the delivery of the requested services

Offeror has a minimum of 7 years experience working with delinquent account collections and performing out-of-state lien enforcement services

Sufficiency of Offeror’s quality assurance and evaluation plans for the proposed services including methodology

Offeror demonstrates capability to coordinate services with DOTAX

Adequacy of facilities relative to the proposed services

Size, experience, qualifications of Offeror’s staff

Offeror’s Financial Stability 3

Tax Collection Procedures

25 Points

Completeness and reasonableness of the applicant’s plan, including the collection, reporting, and accounting services

Access to national databases to trace taxpayers and taxpayers' assets as necessary.

Adequacy of Project Performance and Outcomes Reporting

Technology Capabilities 25 Points Computer system to facilitate the secure exchange of account information, payment information, and status reports

Software aligns with the functional and technical requirements of this RFP, particularly in terms of compatibility and seamless integration with existing DOTAX collection management and data processing systems

Ability to safeguard DOTAX tax return information, files and records and taxpayer personnel information consistent with all relevant federal and state laws

Adequate information management back-up system and procedures and data recovery.

COST 25 Points

SECTION FIVE

CONTRACTOR SELECTION AND CONTRACT AWARD

5.1 EVALUATION OF PROPOSALS

The Procurement Officer, or an evaluation committee of at least three (3) qualified State employees selected by the Procurement Officer, shall evaluate proposals.

The evaluation will be based solely on the evaluation criteria set out in Section Four of this RFP.

Prior to holding any discussion, a priority list shall be generated consisting of offers determined to be acceptable or potentially acceptable. However, proposals may be accepted without such discussions.

If numerous acceptable and potentially acceptable proposals are submitted, the evaluation committee may limit the priority list to the three highest ranked, responsible Offerors.

5.2 DISCUSSION WITH PRIORITY LISTED OFFERORS

The State may invite priority-listed Offerors to discuss their proposals to ensure thorough, mutual understanding. The State in its sole discretion shall schedule the time and location for these discussions, generally within the timeframe indicated in RFP Schedule and Significant Dates. The State may also conduct discussions with priority-listed Offerors to clarify issues regarding the proposals before requesting Best and Final Offers, if necessary.

5.3 AWARD OF CONTRACT

Method of Award. Award will be made to the responsible Offeror whose proposal is determined to be the most advantageous to the State based on the evaluation criteria set forth in the RFP.

Award Amount will be estimated at $100,001. Due to the nature of the proposal and possible tiered fee schedule on possible future collections, the award amount cannot be determined at a fixed amount. For simplicity purposes, estimated award amount of $100,001 with an approximate HIePRO fee of $750.01 is practical.

When submitting an offer, please be sure to enter $100,001 as the Total Line Item Price.

5.4 RESPONSIBILITY OF OFFERORS

Offeror is advised that in order to be awarded a contract under this solicitation, Offeror will be required to be compliant with all laws governing entities doing business in the State, including but not limited to, the following chapters pursuant to section 103D-310(c), HRS:

1. Chapter 237, General Excise Tax Law;

2. Chapter 383, Hawaii Employment Security Law;

3. Chapter 386, Worker’s Compensation Law;

4. Chapter 392, Temporary Disability Insurance;

5. Chapter 393, Prepaid Health Care Act; and

6. Section 103D-310(c), Certificate of Good Standing (COGS) for entities doing business in the State.

The State will verify compliance on Hawaii Compliance Express (HCE).

Hawaii Compliance Express. The HCE is an electronic system that allows vendors/contractors/service providers doing business with the State to quickly and easily demonstrate compliance with applicable laws. It is an online system that replaces the necessity of obtaining paper compliance certificates from DOTAX, the Internal Revenue Service; Department of Labor and Industrial Relations, and Department of Commerce and Consumer Affairs.

Vendors/contractors/service providers should register with HCE prior to submitting an offer at https://vendors.ehawaii.gov. The annual registration fee is $12.00 and the ‘Certificate of Vendor Compliance’ is accepted for the execution of contract and final payment.

Timely Registration on HCE. Vendors/contractors/service providers are advised to register on HCE as soon as possible. If a vendor/contractor/service provider is not compliant on HCE at the time of award, an Offeror will not receive the award.

5.5 PROPOSAL AS PART OF THE CONTRACT

This RFP and all or part of the successful proposal may be incorporated into the Contract.

5.6 PUBLIC EXAMINATION OF PROPOSALS

Except for confidential portions, the proposals shall be made available…