Automated Support Agents (AI Chatbots) and Related Solutions & Services

The City of Tucson is requesting proposals for an enterprise-grade AI-powered service automation platform to handle high-volume routine interactions across city departments, with proposals due July 13, 2026 at 2:00 p.m. local Arizona time and a pre-submittal meeting scheduled for June 22, 2026 at 4:00 p.m. via Microsoft Teams. This procurement is structured through the Axia Cooperative purchasing program and will establish a Master Agreement available to participating public agencies nationally, with an estimated annual nationwide purchase volume of $25 million and a two percent administrative fee.

The scope encompasses three phases: Phase 1 focuses on the IT Department Service Desk; Phase 2 targets Tucson Water Customer Service for public-facing interactions; and Phase 3 expands citywide to additional departments. The solution must operate across multiple channels, complete transactions on behalf of users, integrate with existing city systems, and demonstrate scalability. Vendors must propose milestone-based payment structures with separate cost breakdowns for each phase, annual licensing and subscription costs, and a comprehensive Not-To-Exceed pricing structure for participating cooperative agencies. Consumption-based, usage-based, or variable pricing models must be fully detailed with cost assumptions and pricing methodology.

The contract runs for one year from award with the City retaining options to extend for up to four additional one-year periods. No advance payment is provided; compensation is issued only upon satisfactory completion and City acceptance of milestone deliverables.

Evaluation criteria—weighted in order of importance—are Method of Approach, Price Proposal, and Qualifications & Experience (all non-scored), with the committee assessing implementation methodology, platform capabilities, data security, AI transparency, scalability, user adoption strategies, and prior relevant experience. Contractors must maintain Commercial General Liability, Commercial Automobile Liability, Workers' Compensation, Professional Liability, and Network Security and Privacy Liability insurance with the City named as additional insured.

Data security requirements mandate NIST-compliant frameworks, encryption, multi-factor authentication, role-based access controls, patch management (critical vulnerabilities within 7 days), annual penetration testing, continuous monitoring, and Recovery Time Objectives of 48 hours or less. Data residency must be exclusively U.S.-based with FedRAMP or StateRAMP Moderate certification or higher, and the City retains full ownership of all data. Vendors cannot use City data to train or fine-tune AI models without express written consent. Breach notification to the City must occur within 72 hours of discovery.

The contract is funded through federal ARPA assistance and subject to FTA terms and conditions, ARPA compliance requirements, HUD Section 3 labor provisions (25% of labor hours by Section 3 workers, 5% by targeted Section 3 workers), and prohibitions on Huawei and ZTE equipment. Questions are due June 23, 2026 at 12:00 p.m.