Notice of Intent to Sole Source

The Arizona Department of Revenue / State Procurement Office is issuing a Notice of Intent to Sole Source for continued licensing, SaaS hosting, system maintenance, and technical support of the Kelmar KAPS Unclaimed Property Management Solution, with a three-day public comment period closing October 1, 2026.

This is a sole-source procurement. The justification rests on Kelmar Associates, LLC's proprietary ownership of the KAPS software suite as its exclusive developer, the absence of authorized third-party resellers or maintenance providers for the core platform, and the system's configuration to state unclaimed property workflows, statutory compliance requirements, and holder reporting formats. Prospective vendors who believe they can supply a reasonable alternative source capable of meeting functional, technical, and statutory requirements without infringing proprietary rights may submit written responses via the Arizona Procurement Portal Discussion Forum or directly to the Procurement Officer prior to closing.

The scope encompasses a cloud-hosted enterprise solution with user licenses supporting statewide unclaimed property operations under A.R.S. Title 44, Chapter 3. Key deliverables include statutory compliance and NAUPA II/III format file parsing for holder report ingestion and reconciliation; a secure public portal for claimant asset search and ownership documentation submission; fraud mitigation and identity-protection mechanisms using integrated validation and risk analytics; complex asset accounting for non-cash securities and physical tangible property; and interoperability with national platforms to maximize owner recovery. Technical requirements include field-level encryption for Personally Identifiable Information and Taxpayer Identification Numbers, role-based access controls, audit logging, full data migration from legacy systems without operational interruption, and SLA-backed technical support with automated backups and disaster recovery. The vendor must maintain the ability to update system rules, workflows, and reporting templates to accommodate statutory and administrative changes.

The estimated contract value for year one is $859,000. The proposed term is one year with annual renewal options. The Procurement Officer is Robert Ryan, CPO, at rryan@azdor.gov.