SA000007-24_-_FINAL_RFP_(07-02-24).pdf

STATE OF CALIFORNIA Fiona Ma, Treasurer

OFFICE OF THE TREASURER

P. O. BOX 942809

SACRAMENTO, CA 94209-0001

REQUEST FOR PROPOSALS

FISCAL AGENT SERVICES

RFP NO. SA000007-24

NOTICE TO PROSPECTIVE PROPOSERS

July 2, 2024

To Interested Firms:

You are invited to review and respond to this Request for Proposals (“RFP”) No. SA000007-24 entitled Fiscal Agent Services.

The California State Treasurer’s Office (“STO”) requests firms interested in providing fiscal agent services submit a proposal to the address provided below.

Proposals for these services must comply with the instructions included in the RFP. The RFP includes the sample Standard Agreement that the selected firm will be expected to execute. It includes the Std. 213 Agreement and other standard contract provisions to which the selected firm will be bound. The agreement that will be entered into with the State of California (“State”) will include by reference the General Terms and Conditions and Contractor Certification Clauses which may be viewed and downloaded online at https://www.dgs.ca.gov/OLS/Resources/Page-Content/Office-of-Legal-Services-Resources-List- Folder/Standard-Contract-Language. The General Terms and Conditions and all Exhibits that are part of the sample Std. 213 Agreement are not negotiable. By submitting a proposal, your firm agrees to the terms and conditions stated in this RFP.

Any questions regarding this RFP may be submitted in writing by e-mail to calbonds@treasurer.ca.gov no later than July 12, 2024. Please include “RFP-Fiscal Agent” in the subject line of any e-mails submitted. Responses to the questions will be emailed to prospective proposers and posted in the California State Contracts Register (CSCR) at www.caleprocure.ca.gov by July 19, 2024. Further information regarding the submission of questions is included in Section III B of the RFP.

Responses to this RFP must be received under sealed envelope by 4:00 p.m. Pacific Time (PT) on July 26, 2024, at the address provided below and in accordance with the instructions in Section III D of the RFP. Faxed and electronic submissions will not be accepted. Firms should carefully review the instructions for how to submit proposals.

State Treasurer’s Office Public Finance Division – Trustee Services Section

Attn: Tiffany S. Connelly 901 P Street, Suite 313A Sacramento, CA 95814

Responses received after July 26, 2024, at 4:00 p.m. PT will not be accepted. STO protocol requires that firms (and their agents) are to refrain from advocating or inquiring about the status of this selection process unless contacted by the STO. Please direct any necessary contact with the State regarding this request exclusively to Tiffany S. Connelly at (916) 651-6584 or via e-mail to calbonds@treasurer.ca.gov unless directed otherwise by a member of the STO. Please note that no verbal information provided will be binding upon the State unless such information is also issued in writing as an official addendum. Failure to adhere to this protocol may result in disqualification. Thank you for your interest in our program.

Sincerely, /s/ original signed copy on file

Blake Fowler, Director Public Finance Division https://www.dgs.ca.gov/OLS/Resources/Page-Content/Office-of-Legal-Services-Resources-List-Folder/Standard-Contract-Language https://www.dgs.ca.gov/OLS/Resources/Page-Content/Office-of-Legal-Services-Resources-List-Folder/Standard-Contract-Language mailto:calbonds@treasurer.ca.gov http://www.caleprocure.ca.gov/ mailto:tconnelly@treasurer.ca.gov

TABLE OF CONTENTS

I. Purpose and Description of Services

A. Purpose B. Description of Existing Portfolio C. Paying and Registration Activity D. Existing Fiscal Agent Services E. Phase-In of Transfer of Fiscal Agent Duties F. Available Information G. Description of Scope of Work

1. Paying Agent

2. Registrar

3. Reporting Requirements

4. Miscellaneous Requirements

5. Ability to Handle In-Person Payments

6. Separate Account, No Lien or Offset

7. Investment of Funds in the Account

8. Fund Collateralization

9. Transfer of Records upon Termination

H. Term of Agreement

II. Minimum Qualifications for Proposers

III. Proposal Requirements and Information

A. Key Action Dates B. Questions and Answers C. Content and Format of Proposals

1. General Information

2. Organization

3. Operations and Scope of Services

4. Experience

5. Transition and Conversion

6. Fees

D. Submission of Proposals E. Evaluation Process

1. Scoring

2. Additional Criteria

3. Tiebreaker

F. Award and Protest G. Disposition of Proposals H. Agreement Execution and Performance

IV. Preference and Incentive Programs

A. Small Business (SB) or Microbusiness (MB) Preference Program B. Non-Small Business (SB) or Microbusiness (MB) Preference C. Disabled Veteran Business Enterprise (DVBE) Incentive Program D. Target Area Contract Preference Act (TACPA)

V. Required Approvals

VI. Bearer and Registered Bonds Table

VII. Required Attachments

1. Required Attachment Checklist

2. Proposer Certification Sheet

3. Minimum Qualifications Certification

4. Fee Proposal

5. Payee Data Record (STD 204)

6. Contractor's Certification Clauses (CCC 04/2017)

7. Darfur Contracting Act Certification

8. California Civil Rights Laws Certification

9. Generative Artificial Intelligence (GenAI) Disclosure and Factsheet (STD 1000)

10. Bidder Declaration (GSPD-05-105)

11. Small Business or Microbusiness Preference*

12. Non-Small Business Preference*

13. Disabled Veteran Business Enterprise Incentive Program*

14. Target Area Contract Preference Act (TACPA)*

VIII. Sample Standard Agreement (STD 213)

A. Scope of Work

1. Attachment 1 – Key Personnel Resumes

B. Budget Detail and Payment Provisions C. General Terms and Conditions (04/2017) D. Special Terms and Conditions E. Additional Provisions

*if applicable

Request for Proposals No. SA000007-24

I. PURPOSE AND DESCRIPTION OF SERVICES

A. Purpose

The Treasurer of the State of California serves as registrar and paying agent for certain bonds issued by the State of California (“State”) and agencies of the State. The State Treasurer’s Office (“STO”) requests the services of a fiscal agent to provide the registrar and paying agent services described in this Request for Proposals (“RFP”) for previously issued bearer and fully registered bonds (“Bonds”) maturing on or after January 1, 2007. Fiscal agent services are not being sought for bonds serviced by the State held in book-entry form with the Depository Trust Company (“DTC”). The State does not expect to issue additional bonds for which fiscal agent services will be required.

The fiscal agent will perform the required services related to various issues of the following types of bonds:

General Obligation Bonds, State Public Works Board Lease Revenue Bonds, Department of Water Resources Revenue Bonds, and California Housing Finance Agency Housing Revenue Bonds.

B. Description of Existing Portfolio

The STO is requesting fiscal agent services for bearer bonds and fully registered bonds which were issued under 71 separate programs from 1964 to 1991. The final maturity date of the Bonds occurred in 2022. These matured Bonds have principal and certain coupon payments that have yet to be presented by the bondholder for payment. The total aggregate principal value of unpresented Bonds is approximately $15.8 million as of May 31, 2024. These Bonds are paid as they are presented by the bondholder and the obligation to make such payments will exist until all unpresented Bonds and coupons are presented for payment by bondholders, or the monies are escheated back to the STO. A listing of the aggregate number of unpresented Bonds and coupons and the number of separate bond programs is provided in Section VI Bearer and Registered Bonds Table.

C. Paying and Registration Activity

The below table provides the paying agent activity on the existing portfolio of Bonds for the last five years. The table is intended to provide potential firms with a presentation of historic activity and does not imply the same level of activity will occur in the future.

Activity 2019 2020 2021 2022* 2023 Checks Issued 1,934 1,708 942 788 314 Fed Wires 219 495 58 94 54 Electronic Fund Transfers 12 8 3 4 0 *Final Maturity of all outstanding Bonds.

D. Existing Fiscal Agent Services

The STO currently has one firm performing the requested fiscal agent services on the existing portfolio of Bonds.

Following the selection of the fiscal agent, the STO expects the transfer of duties, if applicable, to occur on October 1, 2024.

E. Phase-In of Transfer of Fiscal Agent Duties

The STO expects to phase-in the transfer of the existing portfolio of Bonds to the selected fiscal agent over a period not to exceed thirty (30) calendar days. It is expected that the existing portfolio of Bonds will be transferred by October 30, 2024.

F. Available Information

If selected as the fiscal agent, the following information would be made available from the STO and/or the existing fiscal agent in electronic form:

(1) A complete copy of each of the resolutions, indentures, and other documents defining the terms of the Bonds and the rights of the holders of the Bonds;

(2) The bond data for unregistered bearer and fully registered bonds (including bond numbers, maturity dates, call dates, principal values, and registration status);

(3) The bearer bond interest coupon data (including payment dates, interest amounts, and coupon numbers);

(4) Any applicable bondholder data related to the unpresented Bonds (including names, payment addresses, correspondence addresses, tax identification numbers, and bonds held);

(5) The current “stop file” or “lost securities file” pertaining to lost, stolen, or destroyed bonds;

(6) The calendar year-to-date tax records and payment records;

(7) A STO certificate containing the name, title, and true signature of each person authorized by the STO (the

“Authorized Persons”) to take action on behalf of the STO under the fiscal agent agreement (“Agreement”);

and

(8) Instructions on how funds associated with unpresented Bonds will be transferred to the firm to be made available for future presented payments by bondholders.

G. Description of Scope of Work

The selected fiscal agent shall have duties with respect to the Bonds as follows.

(1) Paying Agent

(a) Promptly process unpresented principal and interest coupon payments for the Bonds as they are received by mail, by courier, and in person from bondholders, banks, successor owners, and other intermediaries. Complete processing for the payment of principal and interest within three (3) business days after documentation is determined to be satisfactory to provide payment.

(b) Verify authenticity of coupons and Bonds presented for payment.

(c) Cancel paid coupons and Bonds.

(d) Maintain the ability to facilitate payment to bondholder either by check, Federal Wire (“Fed Wire”) or electronic funds transfer (“EFT”).

(e) Honor bondholder presentation of coupons and Bonds for payment. If funds are escheated back to the

STO, the fiscal agent will send coupons and/or Bonds back to the bondholder and refer the bondholder to the STO for payment.

(f) Remit unclaimed funds to the STO when formally requested to do so in writing by the STO.

(g) Track and maintain a record of all un-cleared checks and failed Fed Wire/EFT payments issued against

State funds. Checks that are un-cleared after one year will be deemed canceled. After cancellation, the bondholder may request the fiscal agent to issue a check replacement. Any replacement checks issued can only be valid for one year after issuance. The fiscal agent shall make reasonable efforts to locate bondholders to make payment if a check or wire transfer is returned.

(h) If any funds are remitted to the STO, a list of each bondholder’s name, address, and descriptive coupon and/or Bond information associated with the funds will be provided in an electronic format acceptable to the STO.

(2) Registrar

(a) Responsible for managing an accurate and complete register of the list of unpresented registered and bearer bonds numbers for each program of bonds, including the amounts associated with such obligations.

(b) Process all other customary registrar transactions, as required, such as stop transfers and stop payments on lost, stolen, or destroyed bonds, and make any required regulatory filings about lost, stolen, or destroyed bonds.

(3) Reporting Requirements

(a) For each bondholder receiving a payment of principal, prepare individual Form 1099 for the Internal

Revenue Service (“IRS”), with a copy for the State Franchise Tax Board, if required.

(b) During the fiscal agent’s normal business hours, provide the STO with online access to the fiscal agent’s records relating to the State’s bonds and to all accounts holding State funds hereunder. If online access cannot be granted, the fiscal agent shall, at the request of the STO, provide access to such records as requested.

(c) Provide monthly reports to the STO within five (5) business days after the end of each month in the format requested by the STO. At a minimum, the reports shall include a summary of all unpresented payments and monthly activity by program, series, and maturity, and certain daily cash and monthly account statements as agreed to by the STO and the fiscal agent. The timing and content of such reports may be further modified as agreed to by the STO and the fiscal agent.

(d) Provide the STO within five (5) business days after the end of each quarter (March, June, September, December) with a report that lists the unpresented coupons and Bonds by series as of the end of the previous quarter. (Example: report due by the 5th business day of April for data between January 1st through March 31st). The timing and content of such report may be further modified as agreed to by the STO and the fiscal agent.

(e) Provide the STO within five (5) business days after the end of each quarter (March, June, September, December) with a report that lists the number of checks, which includes the amount of each check that remain uncashed by bondholders, by issue date as of the end of the previous quarter. (Example: report due by the 5th business day of April for data between January 1st through March 31st). The timing and content of such reports may be further modified as agreed to by the STO and the fiscal agent.

(f) Provide the STO at least annually with a copy of an internal or external audit report of the fiscal agent’s registration and paying agent business, if not publicly available.

(4) Miscellaneous Requirements

(a) Destroy canceled coupons and bonds and provide certificates of destruction, as requested by the STO.

(b) Maintain records in accordance with all federal and State requirements, including The Securities and

Exchange Commission (“SEC”) regulatory guidelines and requirements.

(c) Charge bondholders fees or service charges only as authorized by instructions from the STO.

(d) Respond as promptly as practicable to bondholder inquiries.

(e) Upon the request of the STO, the fiscal agent shall confirm the validity and provide substantiation of the validity of a medallion signature guarantee stamp applied on the back of a registered bond or on a Bond Power form related to transferring ownership (for payment purposes) of registered bonds serviced by the STO.

(f) Maintain an accurate and complete “stop file” for lost, stolen, or destroyed bonds.

(g) Make all records available during the fiscal agent’s normal business hours for, and otherwise cooperate fully in, any audits that the State elects to conduct of the fiscal agent’s books and records pertaining to the fiscal agent’s duties hereunder up to three (3) years after the termination of the Agreement.

(h) Comply with all applicable provisions of the California Public Records Act (California Government Code Section 7920.00, et seq) and the California Information Practices Act of 1977 (California Civil Code Section 1798.80 to 1798.86 et seq.) and California Government Code Section 5060.

(i) Upon the request of the STO, provide information or reports related to the Bonds.

(5) Ability to Handle In-Person Payments

The STO currently allows bondholders to present bonds and coupons for payment in person at the STO.

The fiscal agent will be required to accommodate in-person payments by identifying a bank office located in downtown Sacramento where bondholders will be able to receive payment for validly presented bonds by the close of the business day, if requested. The bank office is not required to be an office of the fiscal agent’s financial institution; a correspondent banking relationship is acceptable. The cost of providing the Sacramento branch location must be included as part of the total fee proposal submitted.

If a fiscal agent branch is not located in the Sacramento area, the STO will provide in-person redemption services to bondholders, on the fiscal agent’s behalf, during the STO’s normal business operating hours. The fiscal agent will be required to provide the STO with authorization to issue a check for such payments. In the event coupons and/or Bond(s) is/are presented, the STO will contact the fiscal agent for a timely response to confirm validity. Same day payments will only be issued upon bondholder’s request. All redeemed Bond(s) and coupon(s) will be sent to the fiscal agent, along with a copy of any check issued for such payment and the bondholder’s originally completed IRS Form W-9.

(6) Separate Account, No Lien or Offset

(a) The fiscal agent shall establish and maintain one or more accounts to hold funds required for the payment of the Bonds. State funds held in each such account must be held in an eligible bank as defined by Government Code Section 16500 et seq.

(b) Each account established by the fiscal agent under this Agreement shall be held separate and apart from all other funds of the fiscal agent and separate and apart from all other funds and accounts of the STO or of the State and shall be held in trust for the STO and shall be used solely per STO’s instructions. The fiscal agent shall not have a lien on or any right of offset against any monies held in any such account.

(7) Investment of Funds in the Account

The STO will receive credit for investment earnings on the funds held by the fiscal agent for the payment of the Bonds from the time the funds are deposited with the fiscal agent until the recipient payment clears. It is required that all balances held by the fiscal agent, until such balances are actually drawn down after bondholder checks are presented to the fiscal agent for payment, will be available to generate investment earnings to the credit of the STO (e.g. the time the check is cashed and clears the account from which the check was drawn). Daily balances will include all funds held by the fiscal agent. These balances will also include the “float” resulted from uncashed checks. The fiscal agent will be required each month to provide a daily cash balance report for all accounts maintained under the Agreement and remit the investment earnings to the STO within ten (10) calendar days after the end of each month.

The STO requires that the investment earnings on the State’s funds be based on the daily effective Federal Funds Rate published by the Board of Governors, Federal Reserve System, or as otherwise agreed to by the STO and the fiscal agent. The measurement of equivalent earnings shall be calculated each month and shall include consideration for a reserve.

(8) Fund Collateralization

Deposited funds must be secured with collateral in an amount that is no less than 110% of the amount deposited with the bank, excluding any portion of the deposit insured in accordance with United States law.

Collateral Provisions:

(a) Collateral Level: 110% of principal or such collateral levels as required by California Government

Code Sections 16520 - 16522.

(b) Frequency of Valuation: The securities will be valued by the STO at least monthly, and on any substitution or withdrawal date. The Depository Bank (defined below) is responsible for providing a monthly listing of all pledged securities to the STO. Market values will be calculated using Bloomberg or another nationally recognized pricing service that is mutually agreed upon by the STO and the fiscal agent.

(c) Cure Period: One (1) business day.

(d) Substitution: Full substitution rights. Substituted securities must be Eligible Collateral (defined below).

(e) Substitution/Withdrawal Notice: The fiscal agent shall notify the STO at least one (1) business day in advance of any additions, substitutions, or withdrawals of cash and/or book-entry securities. Third-party Depository Banks may specify different notice requirements with prior approval by the STO.

(f) Depository Bank: California Government Code Sections 16550 – 16554 indicates the custody of securities requirements. All collateral will be pledged to the STO in the account of the third-party Depository Bank with the approval of the STO. The STO may designate one or more other Depository Banks or replace the Depository Bank during the term of the collateral requirement.

(g) Eligible Collateral: California Government Code Sections 16520 - 16522 indicates the types of securities that are acceptable as collateral. Eligible Collateral will be accepted with the approval of the

STO.

In the event the fiscal agent pledges Eligible Collateral, it will have good and marketable title to such Collateral, free and clear of any lien or encumbrance thereon. This Agreement shall provide that, to the extent any Eligible Collateral is to be delivered by the fiscal agent, it shall be deemed to have represented and granted to the Depository Bank, for the benefit of the STO, a first perfected security interest in such Eligible Collateral and in any and all proceeds of and distributions on such Eligible Collateral.

The fiscal agent will limit the securities pledged as Eligible Collateral to ten (10) items or less for each individual fund or account that is the subject of this Agreement. The fiscal agent must provide a full description (including security name, and description, pool number or series, rate, CUSIP, issue date, maturity date, amount/par, original face value, and outstanding principal) of securities to be utilized by the

(9) Transfer of Records upon Termination

On or before the date of termination of this Agreement, the fiscal agent will deliver to the STO, or to a successor fiscal agent as directed by the STO, electronic files containing the information listed under paragraph F of this section and any other records in possession of the fiscal agent that the successor to the fiscal agent may reasonably request.

H. Term of Agreement

The term of this Agreement will be three years, beginning on October 1, 2024, and terminating on September 30, 2027.

II. MINIMUM QUALIFICATIONS FOR PROPOSERS

Proposers must satisfy all the following minimum qualifications to be given further consideration. Failure to satisfy all the minimum qualifications will result in immediate rejection of the proposal.

A. The proposer must be duly authorized to exercise trust powers and be subject to supervision or examination by federal or state authority.

B. The proposer must have a combined capital and surplus of at least $50 million. The STO will consider combined capital and surplus as stated in the proposer’s annual report.

C. The proposer must have a minimum of five (5) years of experience providing relevant fiscal agent services (payment and registration of bearer and registered bonds) to municipal or corporate clients.

D. The proposer must have two current long-term credit ratings of at least A3 from Moody’s Investors Service, A-from S&P Global Ratings, and/or A- from Fitch Ratings.

E. The proposer must have an overall rating of not less than “satisfactory” in their most recent evaluation by the appropriate federal financial supervisory agency of the banks’ record of meeting the credit needs of the communities in which the bank is located, including low- and moderate-income neighborhoods, pursuant to the Credit Reinvestment Act (“CRA”) (Section 2906 of Title 12 of the United States Code).

F. The proposer must provide safekeeping of all physical payment and registration records. The proposer cannot subcontract this responsibility to another firm.

G. The proposer must be qualified to do business in the State of California.

H. Public Contracting Code Section 10295.4 prohibits a State agency from entering into any contract for services with a contractor whose name appears on either list of the 500 largest tax delinquencies produced by the Franchise Tax Board (“FTB”) (https://www.ftb.ca.gov/about-ftb/newsroom/top-500-past-due-balances/index.html) or the California Department of Tax and Fee Administration (“CDTFA”) (https://www.cdtfa.ca.gov/taxes-andfees/top500.htm). Accordingly, the STO will check FTB and CDTFA lists to ensure proposed firms are not on either list.

III. PROPOSAL REQUIREMENTS AND INFORMATION

A. Key Action Dates

All proposers are hereby advised of the following schedule and will be expected to adhere to the required dates.

Event Date RFP Available to Prospective Proposers 07/02/2024 Deadline for Submission of Written Questions 07/12/2024 Distribution of Answers to Written Questions 07/19/2024 Deadline for Submission of Proposals 07/26/2024 Evaluation of Proposals 07/27/2024 – 08/16/2024 Notice of Intent to Award Released 08/19/2024 Anticipated Commencement of Agreement 10/01/2024

The STO reserves the right to change the above dates, and, if so, potential proposers will be notified by email. The STO also reserves the right not to award an Agreement at all.

B. Questions and Answers

To ensure that all proposers receive equal consideration, no questions related to this RFP will be answered by telephone or in person. However, proposers may request clarification by submitting any questions to calbonds@treasurer.ca.gov by July 12, 2024. Please include “RFP-Fiscal Agent” in the subject line of any e-mails submitted. On July 19, 2024, the STO will provide all proposers its response to any submitted written questions via email and the California State Contracts Register (“CSCR”) at www.caleprocure.ca.gov.

C. Content and Format of Proposals

Proposals should include detailed responses to each of the following. Please clearly indicate your response by including each item listed below followed by the response in your proposal. The proposal must be complete and accurate. Omissions, inaccuracies, or misstatements will be sufficient cause for rejection of a proposal.

(1) General Information

(a) Provide a cover letter to your response that will include the name, office location, mailing address, telephone, and e-mail address of the main contact that will be assigned to the STO account.

https://www.ftb.ca.gov/about-ftb/newsroom/top-500-past-due-balances/index.html https://www.cdtfa.ca.gov/taxes-andfees/top500.htm https://www.cdtfa.ca.gov/taxes-andfees/top500.htm mailto:calbonds@treasurer.ca.gov http://www.caleprocure.ca.gov/

(b) Provide documentation that demonstrates your firm is duly authorized to exercise trust powers and subject to supervision or examination by federal or state authority. (Minimum Qualifications, Section

II A)

(c) Provide the most recent year-end audited financial statements, if publicly available electronically a link may be provided in lieu of including the document itself. If the firm is owned by a holding company, identify the firm’s majority owner, and submit financial statements for both the firm and the holding company.

(d) If the firm is a subsidiary of a parent bank or holding company, indicate what type of guaranty the parent bank or holding company provides to the firm with respect to credit enhancement and operations of the firm and include a copy of any documents that effect or constitute that guaranty.

(e) Provide the firm’s three (3) most recent year-end paid-up capital and surplus balance. If the firm publishes a report of condition at least annually, pursuant to law or to the requirements of any supervising or examining authority, then for the purposes of this requirement, the combined capital and surplus of the firm shall deem to be its combined capital and surplus as set forth in its most recent report of condition so published. (Minimum Qualifications, Section II B)

(f) Provide details of the firm’s financial condition including its long-term credit ratings over the past three (3) years and its most recent overall CRA rating. (Minimum Qualifications, Section II D & E)

(2) Organization

(a) Provide a description of how the firm will provide the fiscal agent services requested. This description should identify and provide a location for each of the relevant key personnel available to work on this assignment. Identify the office location(s) where the registrar and paying agent activities will actually be performed.

(b) Provide brief resumes for each of the relevant key personnel identified above including their job classification, number of years employed by the firm, primary roles and responsibilities, and relevant experience.

(c) Briefly describe what competitive advantages your firm possesses in the area of fiscal agency services.

(d) Provide a brief explanation and indicate the current status of any litigation, investigation by a regulatory authority, contingent liabilities, or other legal proceedings involving the firm or any officer or principal of the firm over the past three years. Please include a description of all pending legal and regulatory activity involving the firm.

(3) Operations and Scope of Services

(a) Describe the firm’s proposed approach to on-boarding the existing portfolio using the available information (Purpose and Description of Services, Section I F)

(b) Provide a description of the firm’s (i) payment functions, (ii) registrar functions, including the ability to make payments on registered bonds to successor party/ies, and (iii) stop payment, indemnity bond, claims, and customer service activities, along with a description of all applicable operations and policies related to (i), (ii), and (iii).

(c) Provide a detailed description of the method or the service employed by the firm for security destruction and stop payment process.

(d) Provide a brief description of the firm’s (i) cash management operations and policies and

(ii) accounting, reporting, and internal controls.

(e) Provide samples of proposed reports that would comply with Section I G – Description of Scope of Work, Reporting Requirements (c, d, & e). The STO prefers the ability to receive such reports by electronic means. Please indicate whether the firm is able to accommodate electronic delivery.

(f) Submit SEC turnaround reports as required by Title 17, CFR 240.17 Ad-2 for the past 12 months and any equivalent reports prepared by the firm in support of the firm’s municipal bond operations.

(g) Describe the insurance coverage that would be applicable to this contract and the limitation of that coverage, if any. The firm must supply proof of insurance outlining the extent of liability coverage.

(h) Provide a description of how the firm utilizes or will utilize information technology to help provide the required fiscal agent services and data protection measures the firm employs. Describe the processes, services, and technology that will be utilized to maintain the information related to the Bonds and to help manage bondholder relations.

(i) Describe whether the firm can provide the STO with “read-only” access to records of the STO accounts during normal business hours which will allow the STO to download and print reports. Provide sample reports that can be accessed online or provided as requested.

(j) Describe the firm’s disaster recovery plans. Provide confirmation that the information to be maintained by the fiscal agent related to the Bonds and bondholder records will be included among the firm’s critical data/applications slated for priority recovery under the disaster recovery plan.

(4) Experience

(a) Describe the firm’s relevant fiscal agent experience, including the approximate volume of registered bonds and bearer bonds for which you currently provide fiscal agent services. To meet the minimum qualifications outlined in Section II C, provide a list of clients for whom you provided relevant fiscal agent experience. The list must include the following information:

Name of client, Period during which you provided fiscal agent services, and Dollar value of the bearer and registered bond portfolio for which you provided fiscal agent services.

The State is only interested in evaluating experience with respect to bearer and registered bonds. If the fiscal agent services for a client included bearer, registered, and book-entry only bonds, include here only the information related to experience with the client’s bearer and registered bonds, exclusively.

(5) Transition and Conversion

(a) Provide a summary of how the firm would plan to phase-in or transfer fiscal agent responsibilities.

Outline the steps the firm will take to ensure compliance with Section I E.

(b) Provide a summary of resources the firm would expect the STO to provide during the transition and conversion period, if applicable.

(c) Provide a summary of the planning and training, if any, the firm would need to conduct with the STO and the current fiscal agent prior to the transition/conversion.

(6) Fees

(a) Fees must be submitted in the format prescribed in Attachment 4. Any deviation from the prescribed format which is deemed material may result in the rejection of the proposal. Please note that the fee proposal must include all costs associated with the transition and conversion of assuming the duties of fiscal agent, including establishing the existing portfolio of unpresented Bonds from available information (Purpose and Description of Services, Section I B).

D. Submission of Proposals

(1) All proposals must be received by July 26, 2024, at 4:00 p.m. PT under sealed envelope. Faxed and electronic submissions will not be accepted. The proposal envelopes must be plainly marked with the RFP number and title, the firm name and address; marked with “DO NOT OPEN”, and sent to the STO addressed as follows:

RFP No. SA000007-24 Fiscal Agent Services [Proposing Firm’s Name] [Proposing Firm’s Address]

State Treasurer's Office Public Finance Division – Trustee Services Section

Attn: Tiffany S. Connelly 901 P Street, Suite 313A Sacramento, CA 95814

DO NOT OPEN

(2) All documents contained in the proposal package must include an original signature, or be signed in an acceptable electronic signature format, such as DocuSign, and must be signed by a person who is authorized to bind the proposing firm.

(3) An individual who is authorized to bind the proposing firm contractually shall sign the Attachment 2, Proposer Certification Sheet. The signature must indicate the title or position that the individual holds in the firm. An unsigned proposal may be rejected.

(4) All proposals shall include the documents identified in Attachment 1 of Section VII, Required Attachment Checklist. Proposals not including the proper “required attachments” shall be deemed non-responsive. A non-responsive proposal is one that does not meet all the basic proposal requirements.

(5) Proposals must be submitted for the performance of all the services described herein. Any deviation from the content described in Section III will not be considered and will cause a proposal to be rejected.

(6) A proposal may be rejected if it is conditional or incomplete, or if it contains any alterations of form or other irregularities of any kind. The State may reject any or all proposals and may waive any immaterial deviation in a proposal. The State’s waiver of immaterial defect shall in no way modify the RFP document or excuse the firm from full compliance with all requirements if awarded the Agreement.

(7) Costs for developing proposals and in anticipation of award of the Agreement are entirely the responsibilities of the firm and shall not be charged to the State.

(8) A firm may withdraw its proposal by submitting a written withdrawal request to the State, signed by the firm or an agent authorized as provided herein. A firm may thereafter submit a new proposal prior to the proposal submission deadline. Proposals may not be withdrawn without cause subsequent to the proposal submission deadline.

(9) The STO may modify the RFP prior to the date fixed for submission of proposals by the issuance of an addendum on the CSCR and by email to all parties who received the RFP.

(10) The STO reserves the right to reject all proposals for reasonable cause.

(11) Proposers are cautioned to not rely on the State during the evaluation to discover and report to the proposer any defects and errors in the submitted documents. Proposers, before submitting their documents, should carefully proof them for errors and adherence to the RFP requirements.

(12) More than one proposal from an individual, firm, partnership, corporation, or association under the same or different names, will not be considered. Reasonable grounds for believing that any firm has submitted more than one proposal for the work contemplated herein will cause the rejection of all proposals submitted by that firm. If there is reason for believing that collusion exists among the firm, none of the participants in such collusion will be considered in this or future procurements.

E. Evaluation Process

All proposals will be reviewed by an evaluation committee. At the time of proposal opening, each proposal will be checked for the presence or absence of required information in conformance with the submission requirements of this RFP. The STO will put each proposal through a process of evaluation to determine its responsiveness to the STO’s needs. Proposals that contain false or misleading statements, or which provide references, which do not support an attribute or condition claimed by the firm, may be rejected. If, in the opinion of the STO, such information was intended to mislead the STO in its evaluation of the proposal, and the attribute, condition, or capability is a requirement of this RFP, it will be the basis for rejection of the proposal.

(1) Scoring

The proposals that meet the minimum qualifications will be evaluated and scored according to the criteria indicated below. Below is a list of the maximum number of points allocated to the different proposal content categories. Each proposal will be evaluated and scored in each criteria section. The overall score will be the aggregate sum of the individual criteria scores.

Criteria Maximum Points General Information 50 Organization 50 Operations and Scope of Services 300 Experience 225 Transition and Conversion 75 Fees 300 Total 1000

(2) Additional Criteria

The firm with the highest points total will be considered for the contract subject to the State Personnel Board (“SPB”), Department of General Services (“DGS”), Governor of California, and Department of Finance (“DOF”) approvals. The award of this RFP will be based on a “best value” method that includes fees as a factor. Example of a “best value” calculation:

Proposal 1 Proposal 2 Proposal 3 General Information 48 pts 47 pts 45 pts Organization 48 pts 43 pts 45 pts Operations and Scope of Services 263 pts 211 pts 215 pts Experience 221 pts 167 pts 170 pts Transition and Conversion 73 pts 73 pts 73 pts Fees* 300 pts 225 pts 250 pts

*The lowest Grand Total of Three-Year Contract Fee from Attachment 4 will be awarded the maximum Fees points (300 points). Other proposals will be awarded Fees points based on the following calculation:

(Lowest Fee Proposal/Other Fee Proposal) = (factor) Total points for Other Fee Proposal = (factor) x maximum cost points

EXAMPLE: A maximum of 300 points is available

Lowest Fee Proposal = $750.00 Other Fee Proposal = $1,000.00

(Lowest Fee Proposal / Other Fee Proposal) = $750 / $1,000 = ¾ Total points awarded to Other Fee Proposal = ¾ x 300 = 225 points

Grand Total:

Proposal 1 = 48 + 48 + 263 + 221 + 73 + 300 = 953 Proposal 2 = 47 + 43 + 211 + 167 + 73 + 225 = 766 Proposal 3 = 45 + 45 + 215 + 170 + 73 + 250 = 798

The following point scale will be used to score the response to each scored category, except with regard to Fees:

100% – Excellent response backed by demonstrated ability 85% – Good response backed by demonstrated ability 75% – Fair response backed by demonstrated ability 60% – Poor response 0% – Proposer does not demonstrate ability

The State reserves the right to:

(a) Request an interview with, and additional information from, a firm prior to final selection.

(b) Request an on-site visit with a firm to review the securities clearance operation and facilities.

(c) Consider information about a firm in addition to the information submitted in the response to this RFP.

(d) Conduct background and reference checks.

(3) Tiebreaker

In the event two (2) or more responsive and responsible proposers earn the highest score, the contract will be awarded to the responsive and responsible firm earning the higher score for Fees. If the scores for Fees are the same, the contract will be awarded to the responsive and responsible firm earning the higher score in Operations and Scope of Service.

F. Award and Protest

(1) Notice of the proposed award shall be posted in a public place in the office of the STO, located at 901 P Street, Sacramento, CA 95814, and on the following Internet site for five (5) business days prior to awarding the Agreement: https://www.treasurer.ca.gov.

(2) If any proposer, prior to the award of Agreement, files a protest with the STO and DGS, Office of Legal

Services, 701 Third Street, 7th Floor, Suite 7-330, West Sacramento, CA 95605, on the grounds the (protesting) firm should have received the highest score, the Agreement shall not be awarded until either the protest has been withdrawn or the DGS has decided the matter. It is suggested that the firm submit any protest by contacting the Protest Coordinator at OLSProtests@dgs.ca.gov and emailing calbonds@treasurer.ca.gov.

(3) Within five (5) business days after filing the initial protest, the protesting firm shall file with the DGS and the STO a full and complete written statement specifying the ground for the protest.

G. Disposition of Proposals

(1) Upon proposal opening, all documents submitted in response to this RFP will become the property of the State and will be regarded as public records under the California Public Records Act (Government Code Section 7920.00 et seq.) and subject to review by the public.

(2) The State cannot prevent the disclosure of public documents. However, the contents of all proposals, draft proposals, correspondence, agenda, memoranda, working papers, or any other medium which discloses any aspect of a firm’s proposal, shall be held in the strictest confidence until a Notice of Intent to Award is posted.

H. Agreement Execution and Performance

(1) Service shall be available on the express date set by the STO and the fiscal agent, after all approvals have been obtained and the Agreement is fully executed. Should the fiscal agent fail to commence work at the https://www.treasurer.ca.gov/ mailto:OLSProtests@dgs.ca.gov mailto:calbonds@treasurer.ca.gov contractual date/time, the STO reserves the right to terminate the Agreement within five (5) business days.

In addition, the fiscal agent will be liable for the variance between the Grand Total of Three-Year Contract Fees and the actual cost of performing work by the firm with the second highest scored proposal and/or by another contractor.

(2) All performance under the Agreement shall be completed on or before the termination date of the Agreement.

IV. PREFERENCE AND INCENTIVE PROGRAMS

A. Small Business (SB) or Microbusiness (MB) Preference Program

A five percent (5%) preference will be applied to certified SBs/MBs submitting proposals in response to this RFP.

To obtain the preference, the proposing company must either be a certified SB/MB or be in the process of becoming a certified SB/MB. Proposing companies that wish to obtain the preference shall submit a copy of their certification approval letter from the Department of General Services or shall submit a complete application for certification to the Department of General Services by 5:00 p.m. PT on the proposal due date. Proposing companies in the process of becoming a certified SB/MB must complete the certification process by the time of contract award.

Apply for or Re-Apply for Certification as a Small Business or Microbusiness

The 5% preference is used only for computation purposes to determine the winning proposal and does not alter the amounts of the resulting contract, if any. Once each proposal has been scored, if the highest scored proposal is from a non-certified SB/MB, then 5% of the highest scoring proposal is added to the total “earned” points for each proposal submitted by a certified SB/MB. These final numbers, with the 5% preference included, are then used to determine the new highest scoring proposal.

B. Non-Small Business (SB) or Microbusiness (MB) Preference

A five percent (5%) preference is available to a non-certified SB/MB claiming twenty-five percent (25%) subcontractor participation by a certified SB/MB. If claiming the noncertified SB/MB subcontractor preference, the proposal must include a list of the certified SBs/MBs with which the proposing company commits to subcontract in an amount of at least 25% of the net proposal price. Each certified SB/MB included in the list must perform a "commercially useful function" as defined in Government Code Section 14837(d)(4).

The required list of SBs/MBs with which the proposing company commits to subcontract in an amount of at least 25% of the net proposal price shall be included on the Bidder Declaration (GSPD-05-105) as provided in Attachment 10.

The preference to a non-certified SB/MB shall be 5% of the highest scoring proposal. A non-certified SB/MB, which qualifies for this preference, may not take an award away from a certified SB/MB.

C. Disabled Veteran Business Enterprise (DVBE) Incentive Program

A DVBE incentive will be applied to responsive proposals from responsible proposing companies that are certified DVBEs or that commit to subcontract with a certified DVBE.

Apply for or Re-Apply for Certification as a Small Business or Microbusiness

If committing to subcontract with a certified DVBE, the proposal must include a list of the certified DVBEs that will be acting as subcontractors. The required list of certified DVBEs shall be included on the Bidder Declaration (GSPD-05-105) as provided in Attachment 10. Each certified DVBE included in the list must perform a "commercially useful function" as defined in Government Code Section 14837(d)(4).

Proposing companies or subcontractors who have been certified by the Department of General Services as a DVBE must submit a completed DGS PD 843 (Disabled Veteran Business Enterprise Declaration) form with the proposal response. The form is available at: https://www.documents.dgs.ca.gov/dgs/fmc/gs/pd/pd_843.pdf.

https://www.dgs.ca.gov/PD/Services/Page-Content/Procurement-Division-Services-List-Folder/Certify-or-Re-apply-as-Small-Business-Disabled-Veteran-Business-Enterprise https://www.dgs.ca.gov/PD/Services/Page-Content/Procurement-Division-Services-List-Folder/Certify-or-Re-apply-as-Small-Business-Disabled-Veteran-Business-Enterprise https://www.documents.dgs.ca.gov/dgs/fmc/gs/pd/pd_843.pdf

The DVBE incentive will vary in relation to the percentage of confirmed DVBE participation (up to five percent (5%)). See Attachment 13 for more information.

Any contract awarded to a company committing to subcontract with a certified DVBE will follow requirements as provided in MVC 999.7 including permanent withholds and deductions for non-compliance with the Std. 817 reporting process.

D. Target Area Contract Preference Act (TACPA)

This solicitation provides for an optional TACPA preference. The TACPA program was established to stimulate business investments in distressed areas of the State and create job opportunities for Californians. Proposing companies are not required to apply for this preference. Both the TACPA workplace and workforce preferences will be evaluated for this solicitation. See Attachment 14 for more information.

V. REQUIRED APPROVALS

Certain approvals are required before the new fiscal agent and the State may proceed with the implementation of the Agreement.

A. SPB must have the opportunity to review the Agreement. If such a review is commenced, the Agreement may not be effective unless and until approval is granted by the SPB. Under California Government Code Section 19131, any state agency proposing to execute a contract to outsource services must notify the SPB. The SPB may review the proposed contract for compliance with standards set forth in Public Contract Code Section 10337. Firms will be asked to assist the State in providing information (such as pay rates) to the SPB.

B. DGS must review and authorize the execution of the Agreement.

C. Governor of California must authorize the designation of the fiscal agent and approve the Agreement.

D. DOF must authorize the designation of the fiscal agent and approve the Agreement.

VI. BEARER AND REGISTERED BONDS TABLE

MATURED SERIES WITH UNREDEEMED BONDS & COUPONS

(FIGURES AS OF May 31, 2024)

Issue Name No. of Bearer

Bonds

No. of Registered

Bonds

No. of Active Bondholder

Accounts

Unpresented Principal Amount

No. of Bearer Coupons

Unpresented Coupon Amount

1 1988 SCHOOL FACILITIES (NOV) C 0 2 2 $15,000.00 0 $0.00

2 1988 SCHOOL FACILITIES (NOV) F 0 1 1 10,000.00 0 0.00

3 1990 SCHOOL FACIL ACT (JUNE) A 0 2 2 20,000.00 0 0.00

4 CLEAN WATER 1974 Z 0 1 1 5,000.00 0 0.00

5 CLEAN WATER 1984 T 0 2 2 10,000.00 0 0.00

6 CLEAN WTR & WTR RECLAM 1988 A 0 1 1 10,000.00 0 0.00

7 CO CORRECT FAC CAP EXP 1986 H 0 4 4 60,000.00 0 0.00

8 COMMUNITY PARKLANDS 1986 C 0 2 2 60,000.00 0 0.00

9 COMMUNITY PARKLANDS 1986 E 0 1 1 85,000.00 0 0.00

10 COMMUNITY PARKLANDS 1986 F 0 1 1 10,000.00 0 0.00

11 COUNTY JAIL CAP EXP 1981 H 0 1 1 25,000.00 0 0.00

12 COUNTY JAIL CAP EXP 1984 J 0 1 1 10,000.00 0 0.00

13 CENTRAL VALLEY PROJECT DCC 320 13 13 1,740,000.00 3,138 412,503.75

14 FISH & WLDLFE HAB ENHANCE 1984 F 0 1 1 10,000.00 0 0.00

15 HIGHER EDUC FAC…