Out-of-State Lien Enforcement Services

The Hawaii Department of Taxation is requesting proposals for out-of-state lien enforcement services to collect delinquent tax accounts under RFP-27-TAX-01, with proposals due August 14, 2026 at 4:00 p.m. Hawaii Standard Time and a contract start date of October 1, 2026.

The scope requires a qualified law firm to enforce collections on a contingency fee basis under Hawaii Revised Statutes Section 231-13, targeting approximately $373 million in potentially collectible delinquent taxes as of April 30, 2026 from non-Hawaii-domiciled taxpayers. The contractor must conduct collections throughout the United States and foreign countries, maintain detailed records and status reports on assigned accounts, demonstrate minimum seven years of licensed debt collection experience, and comply with the Fair Debt Collection Practices Act and applicable state and federal privacy laws. The contractor is not entitled to retain statutory interest accruing after account referral, and no contingency fees apply to payments resulting from federal or state tax refund intercepts, bankruptcy proceedings, direct payments to DOTAX, cases referred to the Attorney General, or accounts never referred for collection. The Department retains control over all referred accounts and may recall any account at any time without penalty.

Contractor compensation is calculated solely on amounts actually collected under a contingency fee schedule proposed by the offeror. The estimated award amount for proposal submission is $100,001, though actual compensation will vary based on performance. The initial contract term is twelve months, with two optional twelve-month extensions contingent on mutual written agreement at least sixty days prior to expiration.

All offerors must submit three years of audited financial statements and a current Hawaii tax clearance certificate. Required insurance includes commercial general liability ($1,000,000 per occurrence, $2,000,000 aggregate), automobile liability ($1,000,000 per person/accident), and professional liability ($1,000,000 per claim maintained for two years post-termination).

Evaluation criteria totaling 100 points are experience and capability (25 points), tax collection procedures and methodologies (25 points), technology capabilities and data security (25 points), and proposed cost (25 points). Questions are due July 17, 2026, and state responses are due July 31, 2026. The notice of award is scheduled for August 28, 2026. The contractor must complete comprehensive system testing and go-live within three calendar months of contract execution.