Sales and Use Tax Compliance Review_Recovery_and_Consulting_Services_FINAL.pdf

RFP 26-06 | Sales and Use Tax Compliance Review, Recovery, and Consulting Services

R E Q U E S T F O R P R O P O S A L S

Sales and Use Tax Compliance Review, Recovery, and

Consulting Services

S O L I C I T A T I O N N O . B I D D E S I G N A T I O N

RFP 26-06 Public

D A T E I S S U E D P R O P O S A L S D U E

June 25, 2026 • 2:00 PM CT July 27, 2026 • 2:00 PM CT

S U B M I T V I A C O N T A C T

PlanetBids • Electronic Only DCTA Procurement Department

T A B L E O F C O N T E N T S

SECTION I: GENERAL PROCUREMENT INFORMATION

1. About DCTA

2. Purpose of this Solicitation

3. Procurement Schedule

4. DCTA Contact, Authorized Representative, and Cone of Silence

SECTION II: SCOPE OF WORK, TERMS AND CONDITIONS

1. Minimum Eligibility Requirements

2. Statutory and Regulatory Compliance

3. Reservation of Rights

4. Contract Term

5. Background and Operating Environment

5.1 Sales Tax Revenue Overview

5.2 Current Services Environment

6. Scope of Services

6.1 Project Initiation and Coordination

6.2 Compliance Review and Audit Activities

6.3 Misallocation Correction and Recovery

6.4 Forecasting and Revenue Analysis

6.5 Reporting and Deliverables

6.6 Legislative and Regulatory Monitoring

6.7 Consultation and Ad-hoc Support

6.8 Technology, Data Access, and Data Security

6.9 Transition Cooperation

6.9.1 Transition Notice

6.9.2 Cooperation with Successor Contractor

6.9.3 Work Product Delivery

6.9.4 Pending Reallocation Claims

6.9.5 Commission Determination Periods — Post-Termination Rights

6.9.6 Revocation of Comptroller Agency Authorization

6.9.7 Return and Destruction of Confidential Taxpayer Records

6.9.8 Post-Termination Cooperation

6.9.9 Survival

7. Roles and Responsibilities

7.1 DCTA Responsibilities

7.2 Contractor Responsibilities

7.3 Limitation of Authority

8. Performance Standards

9. Compensation Structure

9.1 Fixed Annual Fee

9.2 Contingency Fee — Recovered Sales Tax

9.3 Contingency Fee — Increased Sales Tax

9.4 Commission Determination Period

9.5 Invoice Requirements and Payment Schedule

9.6 Most-Favored Client

10. Procurement Compliance and Certifications

10.1 Governing Law

10.2 Required Statutory Compliance

10.3 Disadvantaged Business Enterprise (DBE) Applicability

10.4 False Statements

10.5 Required Proposal Certifications and Submittals

11. Evaluation Criteria

11.1 Evaluation Process

11.2 Mandatory Pass/Fail Criteria

11.3 Scored Evaluation Criteria

11.4 Scoring Methodology — Pricing

11.5 Oral Interviews and Presentations

11.6 Tie-Breaking

12. Proposer Deliverables

12.1 Narrative Proposal

12.2 Required Attachments

12.3 Supporting Documents

12.4 Confidential Documents — Submitted Separately

12.5 Exceptions and Deviations

12.6 Sample Agreement

13. Definitions

14. General Terms and Conditions

14.1 Independent Contractor

14.2 Termination for Convenience

14.3 Termination for Default

14.4 Force Majeure

14.5 Disputes

14.6 Protest Procedures

14.7 Assignment and Subcontracting

14.8 Insurance Requirements

14.9 Indemnification

14.10 Record Retention

14.11 Access to Records and Federal Audit Rights

14.12 Non-Discrimination, Civil Rights, and Title VI

14.13 Equal Employment Opportunity

14.14 Americans with Disabilities Act

14.15 Lobbying

14.16 Program Fraud and False or Fraudulent Statements

14.17 Federal Changes

14.18 No Federal Government Obligation to Third Parties

14.19 Telecommunications Equipment Prohibition (Section 889 NDAA)

14.20 Clean Air Act and Clean Water Act

14.21 Energy Conservation

14.22 Minority-Owned Financial Institutions

14.23 Gratuities and Ethics

14.24 Prohibition of Contracts with Companies Doing Business with Iran, Sudan, or Foreign

Terrorist Organizations

14.25 Texas Professional Services Procurement Act Disclaimer

14.26 Open Records

14.27 Tax Exemption

14.28 Funding

14.29 Entire Agreement

14.30 Change Orders and Contract Modifications

14.31 Copyright and Ownership of Work Product

14.32 Severability

14.33 Headings for Convenience Only

SECTION I: GENERAL PROCUREMENT INFORMATION

1. About DCTA

The Denton County Transportation Authority (“DCTA”) is a coordinated county transportation authority organized and operating under Chapter 460 of the Texas

Transportation Code. DCTA serves Denton County and its member cities — Denton, Highland Village, and Lewisville — providing fixed-route bus service, the A-train commuter rail line, on-demand and paratransit services, and complementary mobility programs. DCTA is governed by a five-member voting Board of Directors appointed by its member entities and is headquartered in Lewisville, Texas.

DCTA is funded primarily through a one-half cent (0.5%) local sales and use tax authorized by voters of its member cities and remitted monthly by the Texas Comptroller of Public

Accounts. Sales tax remittances are DCTA’s single largest revenue source, and the accuracy and completeness of those remittances directly affect DCTA’s ability to fund transit operations and capital investment.

2. Purpose of this Solicitation

DCTA is issuing this Request for Proposals (“RFP”) to select a qualified professional firm to provide Sales and Use Tax Compliance Review, Recovery, and Consulting Services as described in Section II. The selected Contractor will identify and correct misallocations of

DCTA’s local sales and use tax revenue; recover sales tax incorrectly allocated to other jurisdictions; provide ongoing analytical reporting, revenue forecasting, and legislative monitoring; and support DCTA’s interactions with the Texas Comptroller of Public Accounts on all matters affecting DCTA’s sales tax revenue.

3. Procurement Schedule

The anticipated procurement schedule is set forth in the table below. DCTA will make diligent efforts to adhere to this schedule but reserves the right to modify any date by addendum posted through PlanetBids (DCTA PlanetBids Home Page).

Milestone Target Date

RFP issued on PlanetBids June 25, 2026 — 2:00 PM CT

Deadline for questions regarding this RFP July 8, 2026 — 2:00 PM CT

Responses to all questions posted as addendum July 13, 2026

Proposals due July 27, 2026 — 2:00 PM CT

Top proposers’ interviews August 12, 2026 – August 14, 2026 https://vendors.planetbids.com/portal/59304/portal-home

Milestone Target Date

Top proposers’ interviews (alternative week) August 19, 2026 – August 21, 2026

DCTA Board of Directors — Contract Authorization September 24, 2026

Tentative contract award October 1, 2026

(a) Questions and Addenda. All pre-proposal questions must be submitted in writing through PlanetBids (DCTA PlanetBids Home Page) by the date and time indicated above.

Questions submitted after the deadline or through any other channel will not be answered.

DCTA will post responses to all timely questions as an addendum through PlanetBids.

Responses to questions constitute amendments to this RFP.

(b) Proposal Submission. Proposals must be submitted electronically through PlanetBids

(DCTA PlanetBids Home Page) no later than the date and time shown above. Proposals received after the deadline will not be considered. DCTA assumes no responsibility for technical failures affecting timely submission.

(c) Evaluation and Interviews. Following the proposal deadline, DCTA's evaluation committee will review and score all responsive proposals in accordance with the criteria in Section 11. DCTA may invite shortlisted Proposers to deliver oral presentations as described in Section 11.5. DCTA will provide shortlisted Proposers at least five (5) business days' advance notice of the interview schedule and format.

(d) Notification of Results. Following contract award, DCTA will notify all Proposers of the outcome through PlanetBids (DCTA PlanetBids Home Page). Unsuccessful Proposers may request a debriefing by submitting a written request to the DCTA Procurement

Department within ten (10) business days of the contract award notification. DCTA will accommodate debriefing requests to the extent practicable.

4. DCTA Contact, Authorized Representative, and Cone of Silence

The designated DCTA contact for all matters relating to this procurement is the DCTA

Procurement Department. All Proposer communications regarding this RFP, including questions, clarifications, requests for information, and any other correspondence, shall be submitted exclusively in writing through the PlanetBids portal (DCTA PlanetBids Home

Page) in accordance with the instructions posted with the RFP. No other method of communication, including telephone, email, in-person contact, or written correspondence directed to any other DCTA employee, officer, Board member, or agent, is permitted from the date of RFP issuance through the date of Board award (the "communications restriction period," commonly referred to as the cone of silence).

The communications restriction period terminates upon DCTA's issuance of award notifications through PlanetBids following Board action.

The authorized representative for execution of the resulting Agreement on behalf of DCTA shall be DCTA's Chief Executive Officer, or such other officer as the Board of Directors may designate by resolution.

https://vendors.planetbids.com/portal/59304/portal-home https://vendors.planetbids.com/portal/59304/portal-home https://vendors.planetbids.com/portal/59304/portal-home

SECTION II: SCOPE OF WORK, TERMS AND CONDITIONS

1. Minimum Eligibility Requirements

To be considered for award, a Proposer must satisfy all of the following minimum eligibility requirements at the time of proposal submission and throughout the term of the Agreement.

A proposal that fails any eligibility requirement will be rejected as non-responsive without scoring.

(a) Authorization: The firm must be authorized to conduct business in the State of Texas and must possess all licenses, certifications, or registrations required by applicable law to perform the services described in this RFP.

(b) Debarment and Exclusions: The firm must not be debarred, suspended, or otherwise disqualified from contracting with any Texas governmental entity, and must not be listed on the Texas Office of the Attorney General's debarment list or any comparable state or local exclusion list.

(c) Experience: The firm must have provided Texas local sales and use tax compliance review, recovery, or consulting services to at least one Texas public-sector client within the past five (5) years.

(d) Key Personnel: The proposed Project Manager must have a minimum of five (5) years of

Texas sales and use tax experience, including demonstrated experience with Texas

Comptroller allocation and reallocation procedures.

(e) Insurance: The firm must certify that it currently carries, or will obtain prior to contract execution, all insurance coverages required under Section 14.8, including at minimum:

professional liability (Errors & Omissions) of not less than $1,000,000 per claim; and cyber liability and network security insurance of not less than $1,000,000 per occurrence.

(f) No Disqualifying Conflicts: The firm must have no disqualifying conflict of interest with

DCTA or its member cities that would impair its ability to perform the services impartially.

Proposers shall confirm satisfaction of each minimum eligibility requirement in the

Minimum Eligibility Confirmation Letter (Attachment 9) signed by an authorized officer.

2. Statutory and Regulatory Compliance

All services under this Agreement shall be performed in accordance with applicable federal, state, and local law, including without limitation: the Texas Sales and Use Tax Act (Texas

Tax Code, Title 2); Texas Tax Code Chapters 151, 321, 322, and 323; Texas Transportation

Code Chapter 460; 34 Texas Administrative Code, Part 1, Chapter 3; and all applicable

Texas Comptroller of Public Accounts rules, directives, and published guidance. The

Contractor shall at all times comply with applicable Federal Transit Administration requirements, circulars, and grant conditions, including without limitation FTA Circular C

4220.1G (Third-Party Contracting Requirements), to the extent any federal funds are involved in DCTA's sales tax operations or the administration of this Agreement.

3. Reservation of Rights

DCTA reserves the right, in its sole discretion, to: cancel this RFP or reject any or all proposals at any time before contract execution; waive any formality or irregularity in any proposal; negotiate contract terms with the recommended Proposer; issue addenda to modify the scope, schedule, or requirements of this RFP; award the Agreement to the Proposer whose proposal is determined to represent the best value to DCTA; and decline to make any award if no proposal is deemed acceptable. DCTA is not responsible for any costs incurred by Proposers in preparing or submitting proposals. DCTA reserves the right to require additional financial information from shortlisted Proposers prior to award.

4. Contract Term

The initial term of the resulting Agreement shall be three (3) years from the date of Notice to

Proceed (“Initial Term”), unless earlier terminated in accordance with the Agreement. DCTA shall have the option, at its sole discretion, to extend the Agreement for up to two (2) additional one-year periods (“Option Years”) upon written notice to the Contractor not less than sixty (60) days before expiration of the then-current term, subject to appropriation of funds and satisfactory Contractor performance.

Pricing for Option Years shall be as stated in Attachment 1. Any increase in the fixed annual fee for an Option Year shall not exceed the lesser of (a) three percent (3%) above the immediately preceding year’s fee, or (b) the percentage change in the U.S. Bureau of Labor

Statistics Consumer Price Index for All Urban Consumers (CPI-U), Dallas-Fort Worth-

Arlington, Texas, for the twelve-month period ending on the most recent October 31 before the Option Year commences. Contingency rates shall remain fixed throughout the Initial

Term and any Option Years.

5. Background and Operating Environment

5.1 Sales Tax Revenue Overview

DCTA receives monthly distributions from the Texas Comptroller of Public Accounts reflecting its share of the one-half cent (0.5%) local sales and use tax collected within its member cities. Sales tax revenue constitutes the single largest revenue source for DCTA’s operating and capital budgets. Allocation errors at the state, county, transit-authority, or special-district level — including misallocation, misreporting, or non-reporting by taxpayers

— directly reduce funds available for transit operations and capital projects.

DCTA is funded by sales tax collections in the Cities of Denton, Highland Village, and

Lewisville under the authority of Chapter 460 of the Texas Transportation Code. The

Contractor must be familiar with the combined-area allocation rules applicable to Chapter

460 transit authorities and the interaction of DCTA’s sales tax with other special-purpose district levies in the same geographic areas.

5.2 Current Services Environment

DCTA currently has an active sales and use tax compliance and recovery services agreement.

The Contractor selected under this RFP will be expected to establish a baseline of all open

Comptroller periods and to initiate compliance review activities promptly upon receipt of the

Notice to Proceed.

6. Scope of Services

The Scope of Services consists of the activities described in Sections 6.1 through 6.9. The

Contractor shall perform all services in accordance with applicable Texas law, including

Texas Tax Code Chapters 151, 321, 322, and 323 and Texas Transportation Code Chapter

460 and Comptroller Rules in 34 Texas Administrative Code, Part 1, Chapter 3. All services shall be performed in a professional and workmanlike manner consistent with industry standards for sales and use tax compliance review services to Texas public-sector clients.

6.1 Project Initiation and Coordination

(a) Conduct a kickoff meeting with DCTA’s designated staff within fifteen (15) calendar days of the Notice to Proceed to confirm objectives, scope, project plan, communication protocols, escalation paths, points of contact, and reporting cadence.

(b) Provide DCTA with a written project work plan and schedule, including major milestones, within thirty (30) calendar days of the Notice to Proceed.

(c) Establish recurring status meetings (no less frequent than monthly) and define logical checkpoints to review progress, findings, and recommended actions.

(d) Obtain and execute all documentation required for the Contractor to act as DCTA’s authorized agent for purposes of accessing confidential taxpayer data from the

Comptroller in accordance with Texas Tax Code §§ 321.3022, 322.2022, and 151.027.

(e) Maintain a defect-free Comptroller agency authorization on file at all times during the

Agreement term and renew it as required.

6.2 Compliance Review and Audit Activities

(a) Examine all Comptroller records pertaining to sales and use tax collected on behalf of

DCTA for all open periods, including monthly distribution reports, quarterly detail reports, and any taxpayer-specific confidentiality reports.

(b) Conduct ongoing audits to identify allocation errors, reporting errors, place-of-business sourcing errors, point-of-delivery errors, marketplace-provider errors, and out-of-state seller use tax errors that affect DCTA revenue.

(c) Identify businesses that operate within DCTA’s territory but that fail to register, fail to collect tax on taxable sales, or remit tax to an incorrect jurisdiction (“discovery” activity).

(d) Where appropriate, contact the management or accounting officials of identified taxpayers to validate the issue, document the error, and assist with corrective action. The

Contractor shall maintain a written log of all such contacts and outcomes.

(e) Address the full range of misallocation patterns common in Texas, including but not limited to: place-of-business mis-sourcing; fulfillment-center mis-sourcing; contractor and construction-services mis-sourcing; online and marketplace-application order sourcing; drop-shipment and direct-pay-permit issues; special-district overlap and combined-area errors; and use-tax accrual gaps.

(f) Address Comptroller Rule § 3.334 (Local Sales and Use Taxes) developments, including ongoing rulemaking and litigation regarding local sourcing of intrastate online sales and any successor or related matters.

6.3 Misallocation Correction and Recovery

(a) Prepare and submit to the Comptroller all information necessary to correct identified allocation errors, including reallocation requests, supporting documentation, and follow-up communication required to obtain reallocation of funds to DCTA.

(b) Assist non-compliant taxpayers, where appropriate, in the preparation and filing of amended returns and reallocation requests, in correcting registration information, and in remitting tax to the proper jurisdiction.

(c) Track each open recovery item from identification through resolution and report status quarterly, including the period covered, dollar amount in dispute, dollar amount recovered, and any unresolved Comptroller positions.

(d) Pursue all permissible look-back periods under the four-year statute of limitations in

Texas Tax Code §§ 111.107 and 111.201, and the longer periods applicable in cases of fraud or non-permitted businesses.

6.4 Forecasting and Revenue Analysis

(a) Provide a sales and use tax revenue forecast for the current and following fiscal year, refreshed at least semi-annually and upon material change in conditions.

(b) Provide a multi-year (minimum five-year) revenue projection upon request to support

DCTA’s annual budget cycle, capital improvement plan, and long-range financial plan.

(c) Identify and quantify revenue impacts associated with major economic events, legislative or regulatory changes, large taxpayer relocations, and shifts in e-commerce or marketplace activity.

(d) Maintain and provide DCTA access to a database of DCTA-allocated taxpayers, including taxpayer name, address, permit number where available, NAICS or business-code classification, and historical allocation amounts.

6.5 Reporting and Deliverables

At a minimum, the Contractor shall produce the following deliverables. All deliverables shall be provided in DCTA’s preferred electronic format (Excel, CSV, or PDF, as applicable) and shall be archived in a manner accessible to DCTA throughout the term of the Agreement.

Deliverable Frequency Minimum Content

Compliance Review

Status Report Quarterly

Errors detected, documented, and corrected during the period; status of all open items; aggregate and per-item dollar impact; commission period detail

Deliverable Frequency Minimum Content

Commission Invoice

Schedule Quarterly

Business name, audit period, taxpayer permit number, local allocation received by DCTA, and amount due to

Contractor; cross-referenced to Comptroller distribution reports

Top Taxpayer Report Quarterly

Top 100 DCTA-allocated taxpayers by sales tax remitted, year-over-year comparison, and trend commentary

Economic-Category

Performance Report Quarterly

DCTA allocations by economic category and NAICS code, with year-over-year and quarter-over-quarter variance

Revenue Forecast Semi-annual

Forecasted sales tax revenue for current and following fiscal year with assumptions, methodology, and sensitivity analysis

Multi-Year Revenue

Projection On request

Five-year (minimum) projection with stated assumptions, for DCTA budgeting, capital improvement plan, and long-range financial planning

Legislative &

Regulatory Alert As needed

Plain-English summary and quantitative impact analysis of any Texas law, Comptroller rule, or court decision affecting DCTA local sales tax

Annual Summary

Report Annual

Year-end summary of recovery activity; total dollars recovered and increased; taxpayer education activity;

forecast vs. actual reconciliation; recommended priorities for following year

6.6 Legislative and Regulatory Monitoring

The Contractor shall actively monitor and timely advise DCTA regarding Texas legislative and regulatory developments that could affect DCTA’s sales and use tax revenue, including but not limited to:

(a) Comptroller Rule § 3.334 (Local Sales and Use Taxes), including ongoing rulemaking and litigation regarding local sourcing of intrastate online sales (e.g., City of Round Rock

v. Hegar and successor or related litigation).

(b) Texas Tax Code § 151.0242 and related provisions concerning marketplace providers and marketplace sellers.

(c) Comptroller Rule § 3.330 (Data Processing Services) and related expansions to taxable services.

(d) Any change to the Texas Tax Code, Comptroller rule, or judicial decision affecting

Chapter 460 transit authorities, special purpose districts, the 2% local cap, or combined-area allocation.

(e) State and federal legislation, including remote-seller economic-nexus thresholds and similar developments under South Dakota v. Wayfair (and successor decisions).

(f) Monitoring shall include, at minimum, distribution of Legislative & Regulatory Alerts

(per Section 6.5), an annual legislative outlook briefing prior to each regular session of the Texas Legislature, and availability for ad-hoc analysis during legislative sessions.

6.7 Consultation and Ad-hoc Support

(a) Provide DCTA staff with unlimited reasonable access to Contractor’s subject-matter experts during normal business hours for sales and use tax questions, interpretation of

Comptroller actions, and analysis of specific transactions or taxpayers.

(b) Provide ad-hoc analytical support, including special revenue impact analyses, economic development incentive evaluations, transactions involving the relocation or expansion of major taxpayers, and analyses related to potential boundary or membership changes.

(c) Support DCTA in interactions with the Comptroller, member cities, and other stakeholders regarding allocation issues, including written correspondence and, when necessary, participation in meetings.

(d) Provide training to DCTA staff at least once per Agreement year on Texas sales tax fundamentals, recent rule and statutory changes, and Contractor tools and reports.

6.8 Technology, Data Access, and Data Security

(a) Provide DCTA designated personnel with secure online access to a Contractor-hosted reporting and analytics platform that includes, at minimum: dashboards summarizing

DCTA allocations by category and segment; taxpayer-level detail (subject to confidentiality); trend visualization; and the ability to export underlying data in standard formats.

(b) Implement and maintain administrative, physical, and technical safeguards designed to protect the confidentiality of Comptroller records and any other DCTA confidential information, including encryption of data in transit (TLS 1.2 or higher) and at rest (AES-

256 or equivalent), role-based access controls, and audit logging.

(c) Comply with the confidentiality provisions of Texas Tax Code §§ 151.027 and 321.3022 and any nondisclosure provisions of the Agreement. The Contractor shall not retain confidential taxpayer information derived from Comptroller records after expiration or termination of the Agreement, except as required by law.

(d) Promptly notify DCTA of any actual or reasonably suspected data security incident affecting DCTA confidential information within twenty-four (24) hours of discovery and cooperate with DCTA in any subsequent investigation, notification, or remediation.

(e) Annually provide to DCTA a description of Contractor’s information-security program, including any third-party attestations (e.g., SOC 2 Type II, ISO 27001) where available.

(f) Maintain a documented disaster recovery and business continuity plan and provide

DCTA with a summary upon request.

6.9 Transition Cooperation

6.9.1 Transition Notice

Upon expiration, non-renewal, or termination of the Agreement for any reason, a transition period of not less than ninety (90) calendar days shall commence on the date DCTA provides written notice of non-renewal or termination, or the date the Contractor provides written notice of its intent not to renew (whichever is earlier). During the transition period, the

Contractor shall continue to perform all services required under the Agreement at the same level of service, for the same compensation, and shall cooperate fully with DCTA and any incoming successor contractor.

6.9.2 Cooperation with Successor Contractor

During and after the transition period, the Contractor shall cooperate fully and in good faith with DCTA's successor contractor. Cooperation shall include, without limitation:

(a) Participating in reasonable joint meetings or calls with the successor contractor and

DCTA at mutually agreed times;

(b) Explaining the status, history, and methodology of all open and recently closed matters;

(c) Answering written questions from the successor contractor regarding prior work, findings, and Comptroller correspondence, within five (5) business days of receipt; and

(d) Providing introductions or background documentation for any matter in which the

Contractor has developed institutional knowledge relevant to DCTA's ongoing sales and use tax position.

6.9.3 Work Product Delivery

All reports, analyses, work papers, correspondence, data files, schedules, and other deliverables produced by the Contractor in connection with this Agreement are the property of DCTA. Within thirty (30) calendar days of the expiration or termination of the Agreement, the Contractor shall deliver to DCTA, in a mutually agreed electronic format:

(a) All final and draft reports and analyses prepared during the term, organized by period and taxpayer or transaction type;

(b) All correspondence with the Texas Comptroller of Public Accounts, including submissions, responses, and acknowledgments;

(c) A complete log of all reallocation requests submitted, identifying for each: the taxpayer or category, the period at issue, the date of Comptroller submission, the status as of the

Transition Date, and the amount claimed or recovered;

(d) All work papers, supporting schedules, and data extracts used to identify and support reallocation claims;

(e) Any internal analysis or forecasting models developed specifically for DCTA's account;

and

(f) A written transition summary describing the state of each open matter, any anticipated

Comptroller responses or milestones, and recommended next steps for the successor.

6.9.4 Pending Reallocation Claims

At the Transition Date, some reallocation requests may be pending before the Comptroller or under review but not yet resolved. For each pending claim:

(a) The Contractor shall update and transfer all supporting documentation to DCTA and the successor contractor;

(b) The Contractor shall remain available to assist the successor contractor in responding to any Comptroller inquiries regarding pending claims for a period of twelve (12) months following the Transition Date; and

(c) The Contractor shall be entitled to its agreed contingency fee on Recovered Sales Tax actually received by DCTA as a result of reallocation claims the Contractor submitted prior to the Transition Date, provided the Contractor has delivered the required documentation under Section 6.9.3. Such entitlement shall survive termination of the

Agreement and shall be invoiced and paid pursuant to Section 9.

6.9.5 Commission Determination Periods — Post-Termination Rights

The Contractor's right to commissions accruing during a Commission Determination Period that was running as of the Transition Date survives expiration or termination of the

Agreement, subject to the following:

(a) The Contractor's post-termination commission rights apply only to taxpayer corrections that the Contractor initiated and for which the Contractor's Commission Determination

Period had not expired as of the Transition Date.

(b) The Contractor shall provide DCTA, within thirty (30) days of the Transition Date, a written schedule (the "Open Determination Period Schedule") listing each taxpayer or correction for which a Commission Determination Period is running, the correction date, the applicable period length, and the expiration date.

(c) DCTA shall pay commissions on Increased Sales Tax received during any active

Commission Determination Period appearing on the Open Determination Period

Schedule, in accordance with Section 9, for the duration of that period only.

(d) Any correction the Contractor did not initiate, or for which the Commission

Determination Period had expired before the Transition Date, is not compensable under this provision.

(e) No commission shall be paid on any correction initiated by the successor contractor, even if related to a taxpayer or category previously identified by the incumbent.

6.9.6 Revocation of Comptroller Agency Authorization

The Contractor's authority to act as DCTA's agent before the Texas Comptroller of Public

Accounts under Texas Tax Code §§ 321.3022 and 322.2022 is limited to the term of this

Agreement. Upon expiration or termination:

(a) DCTA shall promptly revoke the Contractor's Comptroller agency authorization and shall provide the Contractor with written confirmation of revocation;

(b) the Contractor shall immediately cease accessing the Comptroller's local allocation portal or any other Comptroller system on DCTA's behalf upon receipt of the revocation notice or on the effective date of termination, whichever is earlier; and

(c) the Contractor shall cooperate with DCTA's execution of all documents necessary to establish the successor contractor's Comptroller agency authorization, including execution of any release or termination documentation required by the Comptroller.

6.9.7 Return and Destruction of Confidential Taxpayer Records

All confidential taxpayer information obtained from the Comptroller pursuant to Texas Tax

Code §§ 321.3022 and 151.027 is subject to strict confidentiality obligations that survive termination of this Agreement. Within thirty (30) calendar days of the Transition Date:

(a) the Contractor shall return to DCTA all Comptroller-sourced taxpayer data, including all copies and derivatives, in a format designated by DCTA; and

(b) the Contractor shall certify in writing to DCTA that it has destroyed all remaining copies of confidential taxpayer information in its possession or under its control, including data held by subcontractors, cloud service providers, or any third party acting on the

Contractor's behalf, in accordance with applicable Comptroller requirements.

The Contractor's confidentiality obligations under Section 6.8 and Section 14 of this

Agreement survive indefinitely with respect to any taxpayer information obtained during the term.

6.9.8 Post-Termination Cooperation

For a period of three (3) years following the expiration or termination of this Agreement, the

Contractor shall cooperate reasonably with DCTA in connection with:

(a) any audit, review, or inquiry by the Comptroller, DCTA's independent auditor, or any governmental authority regarding sales and use tax matters arising from or relating to the

Contractor's work under this Agreement;

(b) any dispute, claim, or legal proceeding involving sales and use tax allocations for periods falling within the Contractor's term; and

(c) any request by DCTA for documentation or information reasonably necessary to support

DCTA's position before the Comptroller or in any administrative or judicial proceeding.

DCTA shall reimburse the Contractor for reasonable, pre-approved out-of-pocket expenses incurred in providing post-termination cooperation under this Section, but no additional professional fees shall be payable for cooperation reasonably necessary to address matters arising from the Contractor's own performance.

6.9.9 Survival

The following obligations survive expiration or termination of this Agreement for the periods specified or, if no period is specified, indefinitely: Section 6.8 (Confidentiality and Data

Security); Section 6.9.4 (Pending Reallocation Claims); Section 6.9.5 (Commission

Determination Periods); Section 6.9.7 (Return and Destruction of Confidential Taxpayer

Records); Section 6.9.8 (Post-Termination Cooperation); Section 14.9 (Indemnification);

Section 14.10 (Record Retention); and Section 14.11 (Access to Records and Federal Audit

Rights).

7. Roles and Responsibilities

7.1 DCTA Responsibilities

(a) Provide the Contractor with historical sales and use tax information and any Comptroller confidentiality reports previously received and retained by DCTA.

(b) Issue and renew, as necessary, written agency authorizations and resolutions enabling the

Contractor to access confidential taxpayer data on DCTA’s behalf.

(c) Issue any documentation required by the Comptroller to correct allocation errors validated by the Contractor and approved by DCTA.

(d) Designate a primary point of contact and respond to Contractor inquiries within reasonable timeframes.

(e) Pursue in good faith corrective action on errors validated by the Contractor and approved by DCTA.

7.2 Contractor Responsibilities

(a) Perform all services described in this Scope of Work in a professional and workmanlike manner consistent with industry standards for sales and use tax compliance review services to Texas public-sector clients.

(b) Assign a named Project Manager who shall be DCTA’s primary point of contact and who shall not be replaced without DCTA’s prior written consent. Any substitution of key personnel shall require advance written notice to DCTA and DCTA’s written approval.

(c) Maintain qualified personnel with documented Texas sales and use tax expertise throughout the term of the Agreement.

(d) Comply with all applicable federal, state, and local laws, including federal grant clauses where applicable.

(e) Carry and maintain all insurance coverages required under Section 14.8 throughout the

Agreement term and provide certificates of insurance in accordance with Section 14.8.

7.3 Limitation of Authority

The Contractor’s role is limited to detection, documentation, technical assistance, and consultation. The Comptroller and DCTA retain exclusive authority to administer, interpret, and enforce sales and use tax law. The Contractor shall not assume enforcement authority, shall not represent itself as acting on behalf of the Comptroller, and shall not bind DCTA to any tax position, filing, or official submission without DCTA’s prior written approval.

8. Performance Standards

The Contractor shall meet the following minimum performance standards throughout the term of the Agreement. DCTA may treat repeated failure to meet a performance standard as a basis for corrective action up to and including termination for default.

Performance Standard Required Timeframe

Acknowledge written DCTA inquiries 2 business days

Provide substantive response to written inquiries

10 business days (or Contractor-proposed timeline for complex analyses)

Submit identified misallocations to Comptroller after confirmation

60 calendar days (or extended timeline agreed in writing with

DCTA)

Deliver quarterly reports after end of calendar quarter 45 calendar days

Deliver semi-annual revenue forecast before budget cycle start / mid-year review 45 calendar days in advance

Notify DCTA of data security incident Promptly; written notice within 24 hours of discovery

Deliver transition materials upon expiration or termination

30 calendar days of termination date

Maintain defect-free Comptroller agency authorization At all times during the Agreement term

9. Compensation Structure

The structure of compensation is set forth in this Section 9 and in Attachment 1 (Pricing

Form). DCTA encourages a tiered or differentiated fee structure that distinguishes between

Recovered Sales Tax and Increased Sales Tax and that includes a defined Commission

Determination Period.

9.1 Fixed Annual Fee

The Contractor shall propose a fixed annual fee for project initiation, coordination, and ongoing reports and consultation services as described in Sections 6.1 and 6.4 through 6.7.

The fixed annual fee shall cover all labor, overhead, travel, and incidental costs associated with non-contingency deliverables. The fee shall be stated on Attachment 1 for the Initial

Term and each Option Year, subject to the cap in Section 4.

9.2 Contingency Fee — Recovered Sales Tax

The Contractor shall propose a contingency rate as a percentage of Recovered Sales Tax actually received by DCTA. The proposed rate shall be stated on Attachment 1.

9.3 Contingency Fee — Increased Sales Tax

The Contractor shall propose a contingency rate as a percentage of Increased Sales Tax actually received by DCTA. The proposed rate shall be stated on Attachment 1.

9.4 Commission Determination Period

The Contractor shall state its proposed Commission Determination Period on Attachment 1.

9.5 Invoice Requirements and Payment Schedule

The fixed annual fee shall be invoiced quarterly in equal installments. Contingency fees shall be invoiced quarterly, accompanied by the Commission Invoice Schedule required under

Section 6.5, cross-referenced to Comptroller distribution reports, and documenting: business name, audit period, taxpayer permit number, local allocation amount received by DCTA, and amount due to Contractor. DCTA shall pay undisputed invoices within thirty (30) days of receipt. DCTA may dispute any invoice item in good faith; disputed amounts shall not accrue interest pending resolution.

9.6 Most-Favored Client

The Contractor warrants that the contingency rate(s) and fixed annual fee charged to DCTA under this Agreement shall be no less favorable than the rates and fees the Contractor charges to any other Texas governmental entity for substantially similar sales and use tax compliance, recovery, or consulting services. If the Contractor offers more favorable rates to any such entity during the term of this Agreement, the Contractor shall notify DCTA in writing within thirty (30) days and shall apply the more favorable rates to DCTA retroactively from the date those rates took effect. DCTA reserves the right to request, and the Contractor shall provide within fifteen (15) business days, a written certification of compliance with this provision upon request.

10. Procurement Compliance and Certifications

10.1 Governing Law

This Agreement shall be governed by and construed in accordance with the laws of the State of Texas, without regard to conflicts-of-law principles. Venue for any legal action arising under or related to this Agreement shall be in Denton County, Texas.

10.2 Required Statutory Compliance

By submitting a proposal, the Proposer certifies that it will comply with all applicable federal and Texas statutes, rules, and regulations, including:

(a) The Texas Sales and Use Tax Act (Texas Tax Code, Title 2);

(b) The Texas Public Information Act (Texas Government Code, Chapter 552); and

(c) All applicable FTA third-party contracting requirements.

10.3 Disadvantaged Business Enterprise (DBE) Applicability

No federal funds will be used for the payment of services under this Agreement.

Accordingly, the federal DBE requirements of 49 CFR Part 26 and any associated contract goals, good faith effort requirements, or DBE subcontracting obligations are not applicable to this procurement.

10.4 False Statements

A proposal that contains a materially false statement shall be disqualified. DCTA reserves the right to refer the matter to appropriate authorities. Any resulting Agreement obtained through a material misrepresentation shall be voidable at DCTA's election. By submitting a proposal, the Proposer certifies that all information provided is true, accurate, and complete to the best of its knowledge and belief.

10.5 Required Proposal Certifications and Submittals

Each proposal must include the completed and signed certifications and attachments identified in Section 12.2. A proposal that omits any required certification or attachment may be rejected as non-responsive.

11. Evaluation Criteria

11.1 Evaluation Process

Proposals will be evaluated by a committee of DCTA staff. Proposals will first be screened for responsiveness to the mandatory pass/fail criteria in Section 11.2. Responsive proposals will then be scored against the criteria in Section 11.3.

DCTA will award the Agreement on a best-value basis to the responsible Proposer whose proposal is determined to be most advantageous to DCTA, considering all evaluation criteria as weighted below. DCTA is not required to select the lowest-priced proposal. DCTA reserves the right to conduct oral interviews and presentations with shortlisted Proposers and to request Best and Final Offers (BAFO) before making a final recommendation to the Board of Directors.

11.2 Mandatory Pass/Fail Criteria

The following criteria are pass/fail prerequisites to scoring. A proposal that does not satisfy all mandatory criteria will not be scored. These criteria are established in full in Section 1, which controls in the event of any conflict with this Section 11.2.

Mandatory Criterion Result

Firm is authorized to conduct business in the State of Texas Pass / Fail

Mandatory Criterion Result

Firm is not debarred, suspended, or disqualified from contracting with any

Texas governmental entity and is not listed on the Texas Office of the Attorney

General's debarment list or any comparable state or local exclusion list

Pass / Fail

Firm has provided Texas local sales and use tax compliance review or recovery services to at least one Texas public-sector client within the past five (5) years Pass / Fail

Project Manager proposed for DCTA engagement has a minimum of five (5) years of Texas sales and use tax experience Pass / Fail

Firm carries professional liability (Errors & Omissions) insurance of not less than $1,000,000 per claim, and cyber liability and network security insurance of not less than $1,000,000 per occurrence, or certifies it will obtain all coverages required under Section 14.8 prior to contract execution

Pass / Fail

Firm has no disqualifying conflict of interest with DCTA or its member cities that would impair its ability to perform the services impartially Pass / Fail

All required certifications submitted (Section 10.5 and Section 12) Pass / Fail

11.3 Scored Evaluation Criteria

Proposals satisfying all mandatory pass/fail criteria will be evaluated and scored on a 100-point scale using the following rubric:

# Criterion / Sub-Criterion Points Notes

1 Qualifications, Experience, and References 25

1a Firm history, organizational capacity, and continuity — including years in continuous operation, number of full-time staff dedicated to Texas sales and use tax work, and a certification of no pending insolvency or dissolution proceedings

1b Texas-specific sales and use tax expertise, including transit authority and special-district experience

1c Project Manager and key personnel qualifications, resumes, and continuity commitments

# Criterion / Sub-Criterion Points Notes

1d Reference quality and recency, with preference for active or recently completed Texas Chapter 451/452/460 transit authority and special-district engagements

2 Project Methodology and Approach 25

2a Quality and completeness of the proposed work plan, including kickoff, milestones, and ongoing cadence

2b Approach to identifying Texas misallocations (place-of-business, fulfillment, marketplace, drop-shipment, special-district overlap)

2c Approach to taxpayer outreach and education, including treatment of contested cases

2d Reporting and forecasting methodology, including specific deliverables and improvements over SOW minimums

2e Quality assurance, supervision, and continuous-improvement practices

3 Technical Capabilities, Tools, and Data Security 20

3a Analytics and reporting platform features, accessibility, and ability to export underlying data

3b Database management, taxpayer-data quality controls, and integration with Comptroller distribution data

3c Information-security program, including encryption, access controls, audit logging, and incident response

3d Third-party security attestations (e.g., SOC 2 Type II, ISO 27001)

3e Disaster recovery and business continuity plan 2

4 Pricing and Fee Structure 30 See Section 11.4

TOTAL 100

11.4 Scoring Methodology — Pricing

Pricing proposals will be evaluated across three independently scored sub-components. Each sub-component is scored using a proportional lowest-value formula: the Proposer submitting the lowest value for that sub-component receives the maximum points; all other Proposers receive a proportional score calculated as follows:

Sub-Component Score = (Lowest Submitted Value ÷ Proposer's Submitted Value) ×

Maximum Points

# Sub-Component Points Scored On

4a Fixed Annual Fee – Base Year 10

Base-year fixed annual fee stated on Attachment 1, Section A, Base

Year 1

4b Contingency Rate – Recovered Sales Tax 10 Percentage rate stated on

Attachment 1, Section B, line 1

4c Contingency Rate – Increased Sales Tax 10 Percentage rate stated on

Attachment 1, Section B, line 2

A Proposer that proposes a contingency rate of zero for sub-component 4b or 4c will receive the maximum 10 points for that sub-component. Option Year fees, tiered pricing structures, and Commission Determination Period length will be reviewed qualitatively as part of the overall evaluation but will not affect the numerical pricing score.

Illustrative Example. The following hypothetical illustrates how three Proposers would be scored under this methodology. These figures are for illustration only and do not represent

DCTA's expected costs or recoveries.

Sub-Component Proposer A Proposer B Proposer C

Fixed Annual Fee (Base Year) $45,000.00 $60,000.00 $52,000.00

Contingency Rate — Recovered 20% 15% 18%

Contingency Rate — Increased 12% 10% 15%

Sub-Component 4a — Fixed Annual Fee: Lowest fee = $45,000 (Proposer A).

• Proposer A: (45,000 ÷ 45,000) × 10 = 10.00 pts

• Proposer B: (45,000 ÷ 60,000) × 10 = 7.50 pts

• Proposer C: (45,000 ÷ 52,000) × 10 = 8.65 pts

Sub-Component 4b — Contingency Rate, Recovered: Lowest rate = 15% (Proposer B).

• Proposer A: (15 ÷ 20) × 10 = 7.50 pts

• Proposer B: (15 ÷ 15) × 10 = 10.00 pts

• Proposer C: (15 ÷ 18) × 10 = 8.33 pts

Sub-Component 4c — Contingency Rate, Increased: Lowest rate = 10% (Proposer B).

• Proposer A: (10 ÷ 12) × 10 = 8.33 pts

• Proposer B: (10 ÷ 10) × 10 = 10.00 pts

• Proposer C: (10 ÷ 15) × 10 = 6.67 pts

Total Pricing Scores:

• Proposer A: 10.00 + 7.50 + 8.33 = 25.83 pts

• Proposer B: 7.50 + 10.00 + 10.00 = 27.50 pts

• Proposer C: 8.65 + 8.33 + 6.67 = 23.65 pts

11.5 Oral Interviews and Presentations

DCTA may invite shortlisted Proposers to deliver oral presentations and platform demonstrations. DCTA will provide shortlisted Proposers at least five (5) business days’ advance notice of the interview schedule, format, and agenda. If oral interviews are conducted, the written proposal will count for 75% of the total score and the oral interview for 25%. DCTA emphasizes that it may elect to forego oral interviews; all proposals should be comprehensive on their face. The evaluation committee will score oral presentations using the same four evaluation categories in Section 11.3, and the resulting score will constitute the oral component.

11.6 Tie-Breaking

In the event two or more Proposers receive identical composite scores after oral interviews and any BAFO process, DCTA will resolve the tie by ranking Proposers on the basis of:

1) Highest score in Category 1 (Qualifications, Experience, and References);

2) Highest score in Category 2 (Project Methodology and Approach);

3) Drawing of lots administered by DCTA's Procurement Manager in the presence of representatives of each tied Proposer if the tie persists after applying criteria (1) and (2) above.

12. Proposer Deliverables

12.1 Narrative Proposal

Each proposal shall be prefaced by a Letter of Transmittal submitted on the Proposer's firm letterhead. A template is provided in the RFP package for reference. The Letter of

Transmittal shall be signed by an individual authorized to bind the firm contractually and shall confirm the Proposer's intent to submit a firm offer, acknowledge all addenda issued, and include a completed proposal completeness checklist. The Letter of Transmittal shall be the first page of the Proposer's Response File submission in PlanetBids and shall not count toward the 75-page proposal limit.

Each proposal shall constitute a firm offer and remain valid and binding for a period of not less than six (6) months from the proposal submission deadline.

Each Proposer shall submit a written narrative proposal responding to the requirements of

Sections 6 through 9 in the order presented, organized by section and subsection…