esd banking & debit card services rfp - bidnet.com · web viewesd reserves the right to amend...

Washington State Employment Security Department

Request for Proposals 2014-018

for

Banking, Prepaid Debit Card and Lockbox Services

November 7, 2014

Letter of Intent: Due by 4:00 P.M. Pacific Time (PT), December 12, 2014

Proposals: Due by 3:00 P.M. PT, December 31, 2014

October 2014 RFP:ESD-2014

TABLE OF CONTENTS

SECTION I: INTRODUCTION.................................................................................................31. DEFINITIONS..............................................................................................................................................32. AUTHORITY AND PURPOSE....................................................................................................................53. BACKGROUND...........................................................................................................................................64. RFP COORDINATOR..................................................................................................................................75. LETTER OF INTENT TO RESPOND..........................................................................................................76. QUESTIONS.................................................................................................................................................77. RFP SCHEDULE..........................................................................................................................................78. RFP MODIFICATIONS................................................................................................................................89. AGREEMENT...............................................................................................................................................810. RENEGOTIATION OF FEES.......................................................................................................................811. COMPENSATION........................................................................................................................................8

SECTION II: MANDATORY QUALIFICATION REQUIREMENTS...............................1012. EMPLOYMENT SECURITY ACCOUNT.................................................................................................10

SECTION III: SCOPE OF SERVICES...................................................................................1113. MINIMUM ACCOUNT SERVICES TO BE PROVIDED – GENERAL SERVICES................................1114. MINIMUM ACCOUNT SERVICES TO BE PROVIDED – PREPAID DEBIT CARDS...........................1515. MINIMUM ACCOUNT SERVICES TO BE PROVIDED – UNEMPLOYMENT BENEFIT ACCOUNT1616. MINIMUM ACCOUNT SERVICES TO BE PROVIDED – UNEMPLOYMENT COMPENSATION

CLEARANCE ACCOUNT.........................................................................................................................2117. MINIMUM ACCOUNT SERVICES TO BE PROVIDED – TECHNICAL REQUIREMENTS................30

SECTION IV: PROPOSAL REQUIREMENTS.....................................................................32SECTION V: PROPOSAL SUBMISSION..............................................................................37SECTION VI: SELECTION PROCESS..................................................................................39ATTACHMENT A - AGREEMENT STANDARD TERMS AND CONDITIONS..............41AGREEMENT EXHIBIT A – SCOPE OF SERVICES..........................................................61

November 2014 RFP:ESD-2014-018

SECTION I: INTRODUCTION

1. DEFINITIONS

The following terms which appear in this Request for Proposals (RFP) have the meaning that is defined below for the purposes of this RFP:

Agreement: Also referred to as “Contract” throughout this RFP. The Agreement for Banking, Prepaid Debit Card and Lockbox Services to be entered into by and between ESD and the apparent successful Proposer, in substantially the same form as Attachment A to this RFP, which by this reference is incorporated into this RFP.

Automated Clearing House Network (ACH) : A funds transfer system, governed by the Operating Rules of NACHA, the Electronic Payments Association, used by financial institutions, corporations, and consumers which provides for the inter-bank clearing of electronic entries.

Benefit Payment Control (BPC): ESD unit which collects overpaid unemployment benefits.

Business Days and Hours: Monday through Friday, 8:00 a.m. to 5:00 p.m., Pacific Time, except for holidays observed by the State of Washington.

Contract: Also referred to as “Agreement” throughout this RFP. The Contract for Banking, Prepaid Debit Card and Lockbox Services to be entered into by and between ESD and the apparent successful Proposer, in substantially the same form as Attachment A to this RFP, which by this reference is incorporated into this RFP.

Customer Identification Number (CID): A number which identifies a benefit claimant and will be used in place of the Social Security Number (SSN).

Department: The Employment Security Department.

Earnings Credit: Credits which may be used to pay banking related costs.

Employment Security Department (ESD): The agency of the State of Washington that is issuing this RFP.

Credit: An entry to the record of an account to represent the transfer or placement of funds into the account.

Debit: An entry to the record of an account to represent the transfer or removal of funds from the account.

Domestic Wire: Transfer of money to a financial institution within the United States.

Electronic Funds Transfer (EFT): A system for moving funds between bank accounts at different depository institutions. EFT merges electronic money exchanges with electronic data interchange.

Financial Institution: A State or Federally chartered depository institution, such as a bank, savings and loan, or credit union.


Flat File: A data file that consists of fixed length records, each of which is comprised of one or more fields of fixed length and position.

File Transfer Protocol (FTP): A standard for transferring files between computers connected to the Internet.

General Unemployment Insurance Development Effort (GUIDE): The name of the client database system currently used by ESD to manage unemployment benefits.

Graphical User Interface (GUI): The graphical interface of a computer that allows users to click and drag objects with a mouse instead of entering text at a command line.

ICESA: Interstate Conference of Employment Security Agencies, where collection is done on behalf of other states.

NACHA, The Electronic Payments System: The association that establishes the standards, rules and procedures that enable depository financial institutions to exchange electronic payments.

Next Generation Tax System (NGTS): ESD’s system to manage Unemployment Insurance taxes and benefits.

Non-sufficient Funds (NSF): Inadequate funds available to pay a check or ACH debit item.

Originator: An individual, corporation or other entity that initiates entries into the ACH system.

OST: Washington State Office of the State Treasurer.

Pre-note: A zero dollar entry sent prior to the first live entry to notify the Receiving Depository Financial Institution (RDFI) of future payments and test account information.

Prepaid Debit Card: A re-loadable payment mechanism used to deliver payments to individuals. The value of the payments is stored on the card.

Positive Pay: A fraud prevention mechanism that requires payment information to be transmitted to the client’s financial institution in a file format dictated by that financial institution. When a check is presented at a financial institution for payment, the bank reviews the Positive Pay process to validate the check.

Problem Payment: A payment that does not have adequate information for processing (e.g. no SSN or Claimant Identification (CID) available).

Proposal: A formal written offer submitted in response to this RFP to perform the Banking, Prepaid Card and Lockbox Services in accordance with the terms of this RFP.

Proposer: An individual, organization, public or private agency, or other entity, along with its employees and agents, submitting a Proposal in response to this RFP. “Proposer” also includes any firm, provider, organization, individual, or other entity performing services under this Contract.

Protest: An objection by the Proposer, in writing, protesting the results of this RFP, and which complies with all requirements of this RFP.

RCW: Revised Code of Washington


Receiving Depository Financial Institution (RDFI): The financial institution that receives ACH entries and posts the entries to the accounts of its depositors (receivers) and agrees to abide by the provisions of the NACHA Operating Rules and ESD’s UI Benefits systemlines.

Proposal: A formal written offer submitted in response to this RFP to perform the Banking, Prepaid Debit Card and Lockbox Services in accordance with the terms of this RFP.

RFP Coordinator: The person named in this RFP as the RFP Coordinator. The sole point of contact regarding this RFP for Proposers and other interested parties.

Request for Proposal (RFP): This formal procurement document, as well as all amendments and modifications thereto. The RFP is a documented formal procurement process providing Proposers an equal and open opportunity to compete on ESD contracts.

Scope of Services: Services which the Proposer is to perform under any contract awarded, and which is generally in the form of an exhibit attached to the contract.

State: State of Washington, acting through the Employment Security Department, or as otherwise identified.

Submit: To deliver to ESD’s RFP Coordinator, in the manner specified in this RFP, any of several documents described in this RFP.

Unemployment Insurance (UI) Benefits System: ESD’s client database to manage unemployment benefits. (GUIDE is the current database used by the Department).

Washington Administrative Code (WAC): (All references to WAC chapters or sections shall include any successor, amended, or replacement regulation.)

2. AUTHORITY AND PURPOSE

The Employment Security Department (ESD), as authorized by the Washington State Treasurer’s Office under RCW 43.08.015, is requesting qualified Proposers to submit Proposals to provide banking, prepaid debit card, and lockbox services within the State of Washington for unemployment benefit payments paid by the Employment Security Department (“ESD”) and collection of unemployment tax from employers.

This Request for Proposal (RFP) provides Proposers with the information necessary to assess their ability to meet the needs of ESD in providing the specified services; the procedures and criteria that will be used for selection; and the contracting terms required to govern the relationship with the selected Proposer.

Proposals must conform to SECTIONS III AND IV of this RFP. Proposers wishing to provide alternatives to the requested services should demonstrate the Proposer’s unique, cost-effective, or innovative approach to the requested services, where feasible, or additional services offered which may not be specifically requested.

The terms and conditions contained in Attachment A, Agreement for Employment Security Department Banking, Prepaid Debit Card, and Lockbox Services will govern the performance of any contract resulting from this solicitation.


3. BACKGROUND

The Employment Security Department is responsible for collecting Unemployment Taxes paid by employers in Washington State and the proper issuance of Unemployment Benefits to eligible claimants who file for Unemployment Insurance (UI).

The Employment Security Department’s operations are counter-cyclical in nature. When the economy is in a downturn and unemployment rates are high, the Department experiences a higher volume of transactions. The Department also experiences a seasonality trend in its transactions – with higher volumes during the first quarter of the calendar year. Attachment G provides a chart showing the cyclical nature of ESD’s business.

Per federal and state law (RCW 50.16.020 Administration of funds -- Accounts) the collection and payment distribution activities are to be performed within two separate and distinct bank accounts:

1. The Unemployment Compensation Clearance Account (hereafter referred to as the "Clearance Account") for all activities related to Employer Tax collections, and

2. The Unemployment Compensation Benefit Account (hereafter referred to as the "Benefit Account") used for payment of all benefit claims and collections of related overpayments.

Additionally, “…moneys in the clearing and benefit accounts and in the administrative contingency fund shall not be commingled with other state funds, but shall be deposited by the Treasurer, under the direction of the Commissioner, in any bank or public depository in which general funds of the state may be deposited, but no public deposit insurance charge or premium shall be paid out of the fund.” (RCW 50.16.020)

All post clearance tax revenues are transferred to the Washington State UI Trust Fund, an account held in Trust with the Bureau of Public Debt, an agency of the United States Treasury. Funds on deposit are then drawn down as needed from the UI Trust Fund to pay daily claimant benefits.

The ESD lead account had an Average Daily Collected Balance of approximately $47 million in calendar year 2013 and has maintained an Average Daily Collected Balance of approximately $51.5 million through the first nine months of 2014. Approximately $1.3 billion in annual tax collections pass through the Clearance Account and about $1.1 billion in benefits – 55% via ACH/direct deposit and 45% via paper warrants - is disbursed out of the Benefit Account. The Benefit Account is immediately funded by the Washington State UI Trust Fund each day.

Currently ESD has three demand deposit accounts and five zero balance accounts (ZBA), in the name of Washington State Employment Security Department, per Attachment F. New accounts may be opened or accounts may be closed during the contract period as authorized by ESD.

The Department distributes UI benefits via ACH direct deposit or paper warrant.

Attachment H provides ESD’s current banking costs, including lockbox services.


4. RFP COORDINATOR

The RFP Coordinator is the sole point of contact for this procurement. All communications about this procurement must be directed to the following person. Communication directed to other parties shall result in elimination from further consideration.

Lori Pierce, Contracts SpecialistEmployment Security Department212 Maple Park Avenue SEPO Box 9046Olympia WA 98507-9046Telephone: (360) 902-9389Fax: (360) 902-9315E-Mail: [email protected]

5. LETTER OF INTENT TO RESPOND

Proposers intending to submit a Proposal must mail or fax a written Letter of Intent to Respond to the RFP Coordinator. The letter must be received by 4:00 P.M., PT, December 12, 2014, and include the following information:

Proposer name Contact name of person preparing Proposal Telephone number Fax number E-mail address

This information allows ESD to distribute additional information, if necessary, to potential Proposers. Failure to submit the Letter of Intent to Respond shall result in elimination from further consideration.

6. QUESTIONS

All questions regarding the RFP must be received in writing by 3:00 P.M., PT, November 21, 2014. ESD will provide written responses by December 5, 2014 to all Proposers that submit a Letter of Intent to Respond by the deadline. Send inquiries to the RFP Coordinator.

7. RFP SCHEDULE

Event DateIssue RFP November 7, 2014Deadline: Questions November 21, 2014Deadline: Letter of Intent to Respond December 12, 2014Deadline: Proposals December 31, 2014Interviews / Presentations with Finalists (if necessary) January 21-22, 2015Final Selection: Apparent Successful Proposer January 30, 2015Finalize Agreement TBD

Note: ESD reserves the right to revise the above schedule.


8. RFP MODIFICATIONS

ESD reserves the right to amend the RFP, revise the RFP Schedule or issue addenda to the RFP at any time. The Department also reserves the right to cancel or reissue the RFP in whole or in part, for any reason and without penalty, at the sole discretion of ESD at any time prior to the execution of an agreement.

In the event it becomes necessary to revise any part of the RFP, notification shall be posted on WEBS (http://www.ga.wa.gov/WeBS/index.html). In addition, ESD will post amendments and clarifications on WEBS. It is the responsibility of each Proposer to check the website for this information. All responses to this RFP shall be based on the material contained in this RFP and any amendments made to the RFP.

9. AGREEMENT

ESD expects that it will enter into a written agreement with the successful Proposer that formalizes the contracting terms and the services to be provided. The Agreement will be for a period of not more than three and one-quarter (3.25) years, with an option on the part of ESD, to renew the Agreement for an additional three and three-quarter (3.75) year period, or any portion thereof, unless terminated sooner by either party as set forth in the Agreement. The initial contract period will be April 3, 2015 through July 1, 2015. The total contract period, with extensions, shall not exceed seven (7) years (through April 3, 2022).

Any agreement with ESD is contingent upon a written agreement being entered into and accepted by ESD. The Department provides the form of the Agreement and administers the Agreement. Attachment A – Agreement for Employment Security Department Banking, Prepaid Debit Card, and Lockbox Services contains contracting terms ESD requires in the Agreement that are not negotiable. The Proposer, by submission of a response to this RFP, accepts these contractual requirements.

ESD does not guarantee any volumes. Any service procured by the RFP can be terminated due to lack of funding or changes in federal or state law.

10. RENEGOTIATION OF FEES

The fee schedule (Attachment B, Pricing Schedule) will apply for the three and one quarter year period, through June 30, 2018, but will be subject to renegotiation at the inception of any extension period upon terms mutually agreeable to ESD and the successful Proposer.

Fees for new or additional services will be negotiated and included in the fee schedule (Attachment B) as necessary. Fees for additional services will run concurrent with the contract period in effect subject to renegotiation at the end of the contract period, if applicable.

11. COMPENSATION

Separate monthly long form account analysis statements are required for each account. ESD shall compensate the Proposer for services performed during the contract by direct fee and/or compensating balance, based on the monthly long form account analysis statements provided to ESD by the Proposer. There is no predetermined balance requirement and ESD shall receive credit against direct fees owing for average collected balances maintained after reserves, during the service period at the earnings rate. Remaining positive earnings credit allowances will be carried forward from period to period and year to year, as well as deficit earnings balances. The balances due on all


accounts will be consolidated to compute any service charges in excess of earnings allowances due to the Proposer.

ESD will forward payment for service charges to the Proposer, after the Department verifies all activity and charges of the account analysis, as the account analysis will serve as the invoice. Charges will be based on the pricing as listed in Attachment B. The Proposer shall provide an earnings rate calculation method in Attachment B for ESD’s consideration in evaluating the Proposer’s response to this RFP.


SECTION II: MANDATORY QUALIFICATION REQUIREMENTS

12. EMPLOYMENT SECURITY ACCOUNT

Proposers must meet the following minimum qualification requirements to be eligible to provide banking, prepaid debit card and lockbox services for the Employment Security Department accounts. Such requirements must be maintained during the contract period. Failure to meet such requirements shall result in elimination from further consideration.

To qualify, Proposers must:

1. Be insured by the Federal Deposit Insurance Corporation (FDIC).

2. Be located in the state of Washington and approved by the Washington Public Deposit Protection Commission (PDPC) as a qualified public depository (Chapter 39.58 RCW).


SECTION III: SCOPE OF SERVICES

The minimum account services are separated into five sub-sections: Section 13 General Services describes the services required in both the Unemployment Compensation Benefit Account and the Unemployment Compensation Clearance Account; Section 14 describes services required which are unique to the distribution of Unemployment Compensation Benefits by providing clients with a Prepaid Debit Card; Section 15 describes services required which are unique to the Unemployment Compensation Benefit Account and Lockbox processing services; Section 16 describes services required which are unique to the Unemployment Compensation Clearance Account and Lockbox processing services; and Section 17 describes the Technical Requirements for all accounts and services referenced in this RFP.

13. MINIMUM ACCOUNT SERVICES TO BE PROVIDED – GENERAL SERVICES

All minimum account services required must be installed, testing completed and fully operational on July 1, 2015 unless otherwise negotiated.

ESD currently has eight (8) accounts established - three demand deposit accounts (DDA) and five zero balance accounts (ZBA) per Attachment F.

New accounts may be opened or accounts may be closed during the contract period by authorization of ESD. New accounts will be subject to the terms and conditions of this contract.

The Unemployment Benefit Account currently uses three accounts, one DDA and two ZBA. Unemployment benefit payments will be issued out of the zero balance account using warrants or ACH deposits directly to the claimant’s bank account, or by generating a prepaid debit card, or by loading benefits to the claimant’s existing prepaid debit card. Benefit overpayment collections and trust fund wires in will be deposited in to the zero balance account. Wires or ACH for various non-benefit payments will be issued out of the demand deposit account (withholding taxes, child support payments, etc.)

The Clearance Account currently uses three accounts, one DDA and two ZBA. All employer tax payments will be processed into a zero balance account. All employer overpayment refunds and wires out to the Trust Fund will be issued out of a zero balance account.

The following is an outline of the Statement of Work general to the requirements for both the Benefit Account and the Clearance Account.

13.1. Fraud and Abuse Safeguards:

The Office of Special Investigations (OSI) within ESD provides comprehensive investigative services to prevent, detect, deter, and investigate fraud and abuse committed against ESD programs. Its approach requires a cooperative effort between ESD, the Proposer, and other partners, including oversight entities, prosecutors, and other business partners at federal, state, and local law enforcement agencies.

13.1.1. The Proposer shall work with OSI on fraud and abuse related to pre-paid debit cards, warrants, and direct deposit.


13.1.2. The Proposer shall comply with any and all applicable provisions of federal regulation E, 12 CFR 205 et. seq., in providing direct deposit services to claimants, including notice provisions.

13.1.3. The Proposer shall retain in-network ATM video, photo, and/or digital image data for a minimum of 12 months.

13.1.4. The Proposer shall cooperate with OSI and/or its contractors with regard to fraud investigations to the extent permissible by law. The Proposer shall:

• Provide a single point of contact (SPOC) to work with an OSI SPOC to

assist in investigative, detection, deterrence and prevention activity.

• Immediately notify OSI of any accidental or inadvertent release of confidential ESD or claimant information. This notification shall take place no later than the following business day after data breach has been discovered.

• Report and confirm at each quarterly briefing a negative report or absence of any accidental or inadvertent release of confidential ESD or claimant information.

• Provide a single process/form by which OSI can request transaction history, still photo images and/or video images with one request.

• Have a SPOC available during business hours, 8 am to 5 pm Monday through Friday (PT).

• Make its SPOC available after business hours based on business needs with prior notification.

• Have a representative (Custodian of Record for court testimony) available

to testify during hearings for subpoenaed documents.

• Provide a quarterly report and briefing to ESD on trends, patterns and overall fraud related topics state banking services. This report shall include information on new threats, new security related laws, regulations, and standards, and a history of security and fraud related issues since the previous report. The report will detail how the issues were handled and their disposition.

13.1.5. Proposals must include a narrative description of how the Proposer intends to

comply with these requirements and a technical description of the following:

• Description of in-network ATM video, photo and/or digital image data retention process including timelines beyond the 12 month minimum required; and,

• Description of the Proposer’s fraud detection procedures and methodologies; and,


• Description of the Proposer’s fraud investigation processes.

13.2. The Proposer shall provide normal banking services associated with a public funds demand deposit account and analysis services.

13.3. The Proposer shall provide monthly account statements listing all corresponding warrants, credits posted, debits, etc. to ESD in Olympia. These statements must indicate the number of warrants, deposits, debits, and daily ledger balances, and must be provided within ten working days after calendar month end. Please provide a sample monthly account statement.

13.4. The Proposer shall provide monthly long-form account analysis electronically to ESD. Please provide sample long-form account analysis statement.

13.5. The Proposer shall provide cash management services including, but not limited to investment of balances allowed by state law, cash flow analysis, float information and a detailed audit trail of all transactions. Earnings credits will be provided at a percentage or points above a base rate, for example the 91 day T bill rate or Effective Federal Funds rate. Provide where ESD may locate the source for the base rate. If the rate falls at or below 2%, minimum rate shall be provided. ESD prefers that the Proposer allow an earnings credits balance to be carried from period to period and year to year. Please provide the formula to calculate the earnings credit and reveal if any rounding or truncation of decimal points are used in the formula.

13.6. The Proposer shall have incoming and outgoing wire transfer and Automated Clearing House (ACH) processing capabilities.

13.7. The Benefit and Clearance accounts receive check deposits in addition to wire transfer/ACH credits. The Proposer shall credit all items to the accounts on the same day of receipt.

13.8. Deposited checks returned for insufficient funds (NSF) will be automatically presented for collection a second time. NSF checks returned a second time will be debited against the account of original deposit. All NSF items will then be made available to ESD within one (1) banking day of posting to the account.

13.9. ESD shall not be liable for redemption of warrants that have been fraudulently altered or have forged endorsements.

13.10. The Proposer shall provide checks, prepaid debit cards, commercial deposit slips, and endorsement stamps printed to ESD’s specifications, to be negotiated with the apparent successful Proposer.

13.11. The Proposer shall provide a method of stop payment of those checks issued against the Benefit Accounts.

13.12. The Proposer shall provide an Internet Reporting System which will provide collected balances, ledger balances, and all transaction activity (incoming and outgoing wires, ACH, checks, warrants, deposits, etc.). This information shall be available by 7:00 a.m. each business day for the previous banking day’s reporting. Please provide copies of reports generated by your system, both summary and detail reports.


13.13. The Proposer shall enable an ACH debit block and filter on all accounts. ESD will provide the information for the debits that are authorized.

13.14. The Proposer shall provide a complete transition plan and implementation timeline for transitioning services and products from the existing provider to the Proposer’s. The plan must be specific and include testing of automated processes, including electronic file transfers and data uploads and downloads.

13.15. Proposer’s computer system must be able to communicate with ESD’s client-server network. This connection must be a secure link that allows for bi-directional transmission of data files, including but not limited to, ACH files, data files, etc.

13.15.1. Proposer shall support secured communications between itself and ESD. This data exchange must be based upon open, interoperable and secure standards.

13.15.2. Proposer shall support 128-bit secure socket layer (SSL) encryption.

13.15.3. Proposer shall describe what secure transmission modes the Proposer can support.

13.15.4. The Proposer shall provide all hardware, software, and services for the communication link.

13.15.5. Proposer is encouraged to offer a backup communication link to be used should the primary link fail.

13.16. The Proposer shall provide ESD with a toll free number for access to a single point of contact that is dedicated to business conducted by ESD. The Proposer shall provide problem resolution process and escalation protocol. For issues requiring research, ESD will require periodic status updates every three (3) business days until resolved.

13.17. The Proposer shall provide ESD with a toll free number and twenty-four hour, seven-day a week (24/7) access to qualified technical support personnel for the immediate resolution of critical technical issues to ensure the successful flow of data between ESD applications and financial/lockbox services.

13.18. The mailing address of the Proposer’s lockbox where payments are remitted must be in the State of Washington.

13.19. The Proposer shall provide ESD with the foreign exchange rate for agreed upon currencies to include at a minimum Canadian currency, each business day morning not later than 7:00 AM PT by email. This rate will be honored for checks deposited that day that have the rate written upon them or the deposit slip(s).

13.20. The Proposer will, for no fee, cash checks drawn on ESD accounts for payees who present proper identification.


14. MINIMUM ACCOUNT SERVICES TO BE PROVIDED – PREPAID DEBIT CARDS

14.1 The Proposer shall provide a prepaid debit card program for claimants to have their benefits deposited into an individual account set up to access their benefits.

14.1.1 The prepaid debit card program shall be provided at no cost to ESD with no account maintenance fees for cardholders.

14.1.2 Proposer shall provide prepaid debit card design options to be selected by ESD.

14.1.3 Proposer shall indicate whether the Proposer is an authorized single- or dual-issuer of prepaid cards and which vendor(s) they subcontract with for this product.

14.2 ESD shall provide sufficient information regarding each cardholder to establish an account unique to that cardholder.

14.2.1 Cards are to be issued to cardholders by the Proposer at no charge to the cardholder when expedited service is not requested.

14.2.2 On a regular basis, ESD shall transmit funds via ACH that will be loaded onto each cardholder’s account.

14.2.3 The Proposer shall be able to receive at minimum, batch enrollment files via Secure FTP and return an “Echo” file that includes identical information that was sent by ESD, card enrollment report and a rejected enrollee report.

14.2.4 The Proposer shall indicate whether a prenote, or zero dollar transaction, is required prior to loading funds to a prepaid debit card. If a prenote transaction is required, the Proposer shall provide a comprehensive overview/explanation of the process and impacts to ESD and cardholders.

14.3 The Proposer shall provide secure Internet access for ESD staff to enroll new cardholders, update account information, and review payments applied to the accounts.

14.4 The Proposer shall provide a dedicated team to provide customer service, product development, and problem resolution for ESD staff Monday through Friday between the hours of 8:00 AM and 5:00 PM Pacific Time.

14.4.1 The Proposer shall provide online management reports of card and staff activity at no charge to ESD.

14.5. Cardholders must have free options to access funds on their account in the same ways they would with a bank account debit card, including but not limited to: ATMs, Point of Sale, Internet, telephone, teller withdrawals, and online bill pay.

14.6. The Proposer shall provide options for cardholders to receive monthly account statements by mail, account alerts by text or email, and mobile account access.

14.7. The Proposer shall provide periodic card program marketing materials, usage ESD’s UI Benefits systems, and educational information.


14.8 Proposer must provide 24 hour customer service for card holders through a toll free phone number with interactive voice recognition (IVR) and secure Internet access unique to the Washington State ESD Unemployment Insurance Benefits program.

14.9 Proposer shall provide language interpretation services for cardholders, including customers with special needs such as TTY/TTD services.

14.10 It is ESD’s preference that Proposer provides an option for IVR connectivity to a live agent and that the call center is physically located within the United States.

15. MINIMUM ACCOUNT SERVICES TO BE PROVIDED – UNEMPLOYMENT BENEFIT ACCOUNT

The following is an outline of the Statement of Work specific to the Unemployment Compensation Benefit Account, warrant processing, and other minimum account services required.

ESD shall provide the Proposer an electronic file of warrants issued by ESD, inclusive of warrant cancellations, per section 17.2.

Proposer shall:

15.1. Post warrants presented for payment against the outstanding warrants on file and against ESD’s benefit disbursement zero balance account.

15.2. Automatically debit the UI Benefit Account for the amount of warrants redeemed each day.

15.3. Perform a full reconciliation each day that warrants are redeemed. All Proposer errors must be researched and reconciled completely . The reconciliation report will include at the minimum, paid, unpaid and cancellations. At month end a summary report of paid, unpaid and cancellations which are subtotaled by month of issue will be provided electronically. The Proposer shall forward a hard copy of the Proposer reconciliation to ESD within twenty-four (24) hours. Proposer shall provide training to interpret their reports.

15.4. Make all adjustments against the UI Benefit Account from which the transaction originated. The Proposer shall forward an advice of debit or credit with detailed information to ESD for these adjustments within three banking days.

15.5. Provide, each business day, the prior business day’s redeemed warrants via electronic file to ESD. File exchanges will be accompanied by hard copy totals necessary to both the Proposer and ESD’s control.

15.6. Provide web-based next day positive pay services for ESD to accept or reject payment of exception warrants presented for payment.

15.7. Support the replacement of warrants damaged at the time of printing by X-Series warrants. X-series warrants will not have a MICR-encoded warrant number. (Use of X-series warrants will be limited by ESD to the extent possible.)

15.8. Provide a secure automated lockbox service to receive payments for claimant overpayments, deposit into ESD account.


15.8.1. ESD’s UI Benefits system will create and transmit an encrypted secure file of overpayment data to the Proposer each business day. The intent is for the Proposer to use the file to ensure a balance due exists. This will reduce the number of payments being rejected.

15.8.2. The Proposer shall provide an explanation of its payment reconciliation process.

15.8.3. Electronically image and index each page, both sides if additional information is provided on the back, including the envelope. Imaged and indexed documents will be transmitted daily to ESD in a format consistent with ESD imaging system specifications; this will include an index file in order to upload the documents.

15.8.4. Payments received must be deposited and imaged/indexed the day of receipt.

15.8.5. Retain electronic document images for one year. Proposer should be in a position to transmit the images from the one year archive to resolve any payment issues.

15.8.6. Meet ESD security standards. See Attachment E for the interface information.

15.8.7. Retain a history of file transfers using established ESD data requirements archiving ESD’s UI Benefits systemlines.

15.8.8. Ensure safeguards are in place to prevent duplication of cash deposits.

15.8.9. Following ESD’s established UI Benefits system lines, provide backup and recovery processes of the file transfers.

15.8.10. Procure a post office box for BPC mail with a State of Washington mailing address. All BPC mail will be delivered to the post office box.

15.8.11. Mail without money will be couriered to BPC in Olympia no later than the following business day.

15.8.12. The Proposer shall provide a secure “image transaction library” of all payments processed on any given day via an option on the Proposer website. Updates will be posted daily - not on demand.

15.8.13. Methods of look up on the Proposer’s website must include and will appear listed in the following order:

1) Account Number (SSN or CID)2) Account name – last name-include partial wildcard lookup capabilities3) Account name - first name- include partial wildcard lookup capabilities4) Dollar amount that will be posted to that SSN 5) Date Deposited6) Payment Sender name (could be different than account name) include

partial wildcard lookup capabilities7) Check number 8) Check total9) Problem Record Indicator10) Document Number


15.8.14. Payments that cannot be processed, (i.e., marked void, cannot read MICR code, etc.) will not be imaged and will be couriered back in the original envelope, with the check and accompanying documents to ESD Treasury Unit no later than the day following receipt. ESD Benefit warrants returned without the endorsement of “payable to ESD” must also be couriered back to the Treasury Unit the day following receipt.

15.8.15. When one check is received with the intent to be divided between multiple accounts and the amounts equal the total check amount:

A copy of the check and accompanying documents will be imaged and indexed to each individual SSN or CID to be paid. The transaction amount for each individual will be recorded as the Paid Amount the amount of the entire check will be indexed as Check Total. The Paid Amount is the field that will be transmitted to the ESD’S UI Benefits System with the SSN or CID. This generally occurs when an employer is garnishing wages for multiple claimants.

15.8.16. When one check is received with the intent to be divided between multiple accounts and the amounts DO NOT equal the total check amount:

Send the envelope, payment, and contents to ESD Treasury Unit with the unprocessed mail for that day.

15.8.17. After system implementation but before documents are shredded, there must be a test period to ensure confidence with imaged documents before the Proposer begins shredding documents. The test period will end upon mutual agreement with BPC and the Proposer. After the test period, the Proposer shall shred paper documents 7 days after imaging.

15.8.18. Payments that do not contain adequate information for processing are called Problem Payments and will be deposited and coded with 999999999’s in the account field; these will also be indexed with a problem payment indicator and will be investigated and resolved by BPC staff.

15.8.19. Reports:

The Proposer shall provide ESD Treasury Unit with deposit reports daily by electronic transmission.

The Proposer shall provide an electronic report of total records, dollars transferred to ESD’S UI Benefits System and dollars recorded as problem payments for the date processed.

The Proposer shall work with ESD Information Technology Business Integration (ITBI) to define transfer protocols of the reports.

The above reports shall be exportable to MS Excel or similar formats.


15.9. Internet Check Payment Service

The Proposer shall provide an Internet Check Payment Service that gives the Department the ability to collect payments through the ACH Network. The service should support the processing behind the “Pay Button” providing a portal to a Proposer-hosted website to collect the payee’s banking information and create a standard NACHA formatted ACH file. The Department may use the Internet Check Payment Service in conjunction with traditional ACH origination or as a standalone product.

15.9.1 ESD’s website will host the application-specific information such as tax and benefit forms, license renewal, purchase request, etc.; the customer will be transferred to the Proposer’s payment portal by clicking the “Pay Button”. Describe your service’s ability to support this functionality.

15.9.2 ESD requires a product that supports the collection of the customer’s banking information, ACH authorization, payment scheduling, authentication and payment confirmation. Describe your ability to support the collection and authentication of the above information.

15.9.3 The ACH Rules require the Originator implement a commercially reasonable procedure to verify the routing number used in an internet initiated entry is valid. Describe your procedures for routing number validation.

15.9.3.1 Include a description of the procedures or business rules that apply if the routing number fails validation.

15.9.4 ESD’s business partners need to identify the various organizations debiting their account. Describe how your Internet Check Payment Service uniquely identifies each Originator.

15.9.5 This service must provide ESD the flexibility to allow its customers to choose the effective date of their payment. Describe your ability to allow the customer to schedule the effective date of their payment.

15.9.6 ESD has both consumer and corporate payers. Describe how you identify corporate and consumer payers and assign the correct Standard Entry Class (SEC) Code to each ACH Entry.

15.9.7 Describe your Internet Check Payment Service, including its ability to support both recurring and one-time payments.

15.9.8 ESD needs to identify payments that are returned unpaid. Describe your process to notify the Department of returns and notification of changes (NOCs).

15.9.8.1 Describe the process to update your database upon receipt of a NOC.

15.9.9 Describe the customer support available to ESD using your Internet Check Payment Service. Provide research and problem resolution support related to Internet Check Payment Service transactions.

15.9.10 Describe the implementation process you would employ for a new Internet Check Payment Service application.


15.9.10.1 Provide an estimate of an average implementation period.

15.9.10.2 Describe the resources dedicated to an Internet Check Payment Service implementation.

15.9.11 Describe the training provided to new users of the Internet Check Payment product.

15.9.12 To facilitate cash management and investment activities, ESD requires Internet Check ACH files settle directly to the concentration account or one of the sub-accounts opened under the Agreement. Describe your settlement process.

15.9.12.1 For reconciliation purposes, ESD prefers separate settlement entries for origination and returned transactions. Discuss the settlement process for returned transactions.

15.9.12.2 ESD needs the ability to identify settlements by business or organization specific location numbers. Describe your ability to supply the location numbers on your settlement reporting.

15.9.12.3 Describe settlement reporting available to ESD prior to the settlement of the ACH files. Preference will be given to electronic or automated solutions.

15.10. Direct Deposit

ESD issues direct deposit payments to clients’ accounts and generates the direct deposit data according to NACHA Rules.

The Proposer shall provide ESD via secure FTP or Internet, ACH Return Reports for all ACH NOCs and returned ACH debits, disbursements and pre-notes the day following the day of the return or correction.

Requests for ACH adjustments (for example, transaction reversal, deletes, etc.) shall be available through Internet ACH services, email, or fax at no charge to ESD.

The Proposer shall make funds available in accounts within two banking days of ESD sending the file.

The Proposer shall provide a data file on a monthly basis with the valid routing number and the institution information.


16. MINIMUM ACCOUNT SERVICES TO BE PROVIDED – UNEMPLOYMENT COMPENSATION CLEARANCE ACCOUNT

The following is an outline of the Statement of Work specific to the Unemployment Compensation Clearance Account.

16.1. Automated Clearing House (ACH) Services

Proposer shall:

16.1.1. Provide processing for ESD’s ACH program, NACHA formatted debit files.

16.1.2. The download transmission to ESD (return files) will occur on the day of receipt per batch schedules determined by the Department.

16.1.3. Settle files by individual file totals as opposed to batch totals.

16.1.4. Provide a process flow diagram and explanation describing your ACH process to include: the flow between ESD and the Proposer as well as the flow between the Proposer and the ACH Operator.

16.1.5. Provide warehousing of ACH entries so that ESD may send files to the Financial Institution up to thirty (30) days before the effective entry date. The Proposer shall be responsible for releasing the warehoused files into the ACH network in compliance with ACH rules.

16.1.6. The ACH Rules only apply to transactions that are routed through an ACH Operator. Describe your policies and procedures governing ‘on-us’ transactions or transactions sent to a DFI through a direct send relationship. Include details on how ESD’s risk of loss for these transactions is mitigated.

16.1.7. Provide daily electronic files in NACHA format of all notifications of debit ACH returns and rejections, pre-notes and NOCs. The file should be available for pickup by 1:00 A.M. PT each business day. The file shall contain all returned, rejected and NOC entries from the previous business day. The debit file totals shall be equal to the ACH return settlement entry as posted to the account statement for the previous day’s banking activity. Settlement to the account statement shall be reported as one entry for debit returns.

16.1.8. Ensure that individual entry detail items that may reject on an ACH file shall post as single items on reports and on bank statements (that is settlement of an entire ACH file shall post as one single dollar amount per file with individual rejected entries posting as separate dollar amounts).

16.1.9. Provide supporting documentation for ACH returns that are posted manually by the Financial Institution. Documentation shall be provided no later than 9:00 A.M. PT the business day following posting to ESD’s bank account.

16.1.10. Provide a method for ESD to refuse a live dollar or pre-note entry that has incorrectly posted to ESD’s account. Include security procedures to ensure/verify that only authorized ESD staff members are able to refuse these entries.


16.1.11. Provide procedures for ESD to request a dishonor of an improperly formatted NOC or live dollar return transaction. Include security procedures to ensure/verify that only authorized ESD staff members are making the request.

16.1.12. Ensure ACH payments returned for insufficient funds (NSF), R01 will be automatically presented for collection a second time. NSF ACH payments returned a second time will be debited against the account of origination.

16.2. Lockbox and Remittance Processing Services

16.2.1. Definitions

The following definitions apply only to section 16.2:

“Received” shall mean the date post-marked on the envelope in which the payment was sent to the Proposer.

“Process Date” shall mean the date opened and processed by the Proposer.

16.2.2. Mail Services

The Proposer shall rent a minimum of four (4) post office boxes located in Washington State to be assigned to ESD. Employers are instructed to address mail to the correct post office box depending on the document type. Processing for each different document type will be conducted separately and will not be intermingled. The following sample documents are included in Attachment D:

1. Tax summary (form 5208A), wage detail (form 5208B) and payments – Employers use these documents to report their quarterly tax due.

2. Monthly billing coupons and payments – Monthly statement with attached payment coupons (EMS 5229-1) that ESD sends to employers.

3. E-file coupons and payments – Payment coupons that employers print from one of the electronic filing applications available.

4. ICESA remittance listings and payments – ICESA is a quarterly reporting method that was designed to be used by payroll agents who file report for large numbers of clients. The file must be formatted using standard specifications established by the organization formerly known at the Interstate Conference of Employment Security Agencies (ICESA).

The Proposer shall document and electronically report to ESD, through established interfaces, per Attachments E1 through E5, the total number of mail items received for each category from the post office boxes each working day.


16.2.3. Mail Receipt Services

16.2.3.1. The Proposer shall pick up mail from ESD’s post office boxes and deliver to the lockbox facility daily, Monday through Saturday.

16.2.3.2. The Proposer shall ensure security and confidentiality of mail pickup and delivery directly from the U.S. Post Office to the lockbox facility.

16.2.3.3. The Proposer shall sort and document the number of mail items received by each category on the same business day it is received at lockbox by mail pickup or from ESD via Proposer’s courier.

16.2.4. Deposit Processing, Deadlines and Reporting

Validate all negotiable instruments (checks, money orders, cashier checks, etc.) immediately upon receipt.

Endorse all negotiable instruments and prepare an electronic deposit listing with date, batch number, account number and amount.

Checks returned for insufficient funds (NSF) will be automatically presented for collection a second time. NSF checks returned a second time will be debited against the account of origination and delivered, with a copy of the debit advice, to ESD.

16.2.5. Remittance Processing Services

All remittances will be processed with a batch date that equals the post office mail received date. The received date can be no later than the last business date of the payment month.

ESD recognizes that during quarterly processing periods (Attachment C), the Proposer may be unable to process all work on the same day it is received. During the quarterly processing period all mail will be processed no later than the timely date (5th of the month).

If the fifth of the month falls on a Saturday, Sunday, or legal holiday, then the tax report remittances received by ESD on the next banking business day shall be considered as having been received from the employer in a timely manner.

There shall be no unreasonable processing “carry-over” other than that caused by unforeseen circumstances (e.g., power failure). In the event of a carry-over, the Proposer shall record the total number of items received on that date and the total number of items involved in the carry-over. This shall be immediately reported by telephone and by e-mail to ESD with an explanation for the carry-over. The e-mail must contain at a minimum the total number of trays carried over and the date the trays were received.

16.2.6. Remittance Processing Details – Tax Report Remittances

The Proposer shall open all envelopes and sort Tax Report Remittances into two categories: (1) items to be processed by the Proposer, and (2) items that cannot be


processed by the Proposer and must be delivered to ESD. Processed items must not be combined with unprocessed items.

Tax Report Remittances to be processed: Single tax report with a single remittance Multiple tax reports with a single remittance Multiple tax reports with multiple remittances where the sum of the tax

reports equal the sum of the actual amount remitted

The Proposer shall keep tax reports with accompanying remittances and other enclosures together, and remove all staples.

The tax report remittances are processed by the Proposer keying the ES Reference Number, dollar amount, check number, processed date, received date and batch number of the remittance in an electronic file to be transmitted daily to ESD.

The account number must be validated using an ESD-approved process. If the account number is invalid, return tax report and remittance to its original envelope and keep together as a separate batch of items that are unable to be processed and to be forwarded to ESD.

The Proposer shall verify that the remittance amount and the amount entered on line 25 of the tax report agree. If the remittance amount differs from the amount entered on line 25 of the tax report, the Proposer shall change the amount on line 25 to reflect the remittance amount.

The Proposer shall not alter or change any line(s) on the tax report other than line 25 of the tax report as outlined above. A quarterly tax report can be found in Attachment D.

The Proposer shall make every effort to eliminate errors in its processing of critical tax report and remittance data.

Tax Report Remittances will be processed in batches not to exceed ninety-nine (99) items per batch.

Tax Report Remittances Proposer is unable to processThe Proposer may be unable to process tax report remittances for the following reasons:

Tax reports with no remittance. Tax reports with remittances with no account number. Tax reports with remittances with invalid account number. Remittances with no tax report.

The Proposer shall sort and bundle Tax Report Remittances that Proposer is unable to process into separate batches. Keep tax reports together with other enclosures, and remove all staples.


The Proposer shall batch each category of unprocessed items into separate batches, not to exceed ninety-nine (99) items per batch. A paper copy of the batch sequence sheet will be placed on each payment batch. Batch numbers will run consecutively for the entire quarterly processing period.

16.2.7. Remittance Processing Details – Monthly Billing Coupon and District Tax Office

Coupon Remittances

The Proposer shall open all envelopes and sort Monthly Billing Coupon (EMS5229-1) and District Tax Office Coupon (EMS 5229-2) Remittances into two categories: items to be processed by the Proposer and items that cannot be processed by the Proposer and must be delivered to ESD. It is required that processed items not be combined with unprocessed items.

Monthly Billing and Remittances to be processed

Single 5229-1 coupon with a single remittanceMultiple 5229-1 coupons with single remittance Multiple coupons and/or multiple remittances where the sum of the coupons equal the sum of the actual amount remitted.

The Proposer shall keep coupons with accompanying remittances and other enclosures together. Remove all staples.

Monthly billing and remittances are processed by the Proposer scanning the encoded ES Reference Number or keying the ES Reference Number, dollar amount, check number, processed date, received date and batch number of the remittance in an electronic file to be transmitted daily to ESD.

For monthly billing coupons, the received date will be the date received by the Proposer from the post office.

If the remittance entered in the PLEASE ENTER AMOUNT REMITTED box on the right hand side of the statement (coupon) and the actual amount remitted do not agree, using black ink circle remittance amount entered in the box and enter the actual remitted amount directly to the left of the remittance block on the statement (coupon) and add a black check mark () directly to the left of the remittance amount. Initial actual remittance amount entered.

If the remittance amount block on the coupon is left blank, and there is an accompanying remittance submitted, using black ink enter the remittance amount in the remittance block of the statement (coupon) and add a check mark () directly to the left of the remittance amount. Initial the check mark.If the remittance amount entered on the coupon equals the remittance amount submitted, add a black check mark () directly to the left of the remittance amount.

Proposer will process monthly billing and remittances in batches not to exceed ninety-nine (99) items per batch. A paper copy of the batch sequence sheet will be placed on each payment batch. Batch numbers will run consecutively for the entire quarterly processing period per Attachment C.


Exception: When a single remittance is associated to more than ninety-nine (99) unique accounts (ES Reference Numbers), place all records into a single batch regardless of the number of accounts. This batch must be limited to records associated with the single remittance of over 50 accounts and must not contain records that are not part of the single remittance breakdown. The batch total must always match the amount of the single remittance.

Batch numbers are to run consecutively for the entire quarterly processing period per Attachment C. A paper copy of the batch sequence sheet will be placed on each payment batch.

Proposer will image the front and back of the monthly billing coupons (EMS 5229-1), as well as the front and back of the check after endorsement. Send an electronic file of indexes and corresponding images to ESD daily in a format specified by the Department. Indexes will include at a minimum, ES Reference Account Number, received date, processing date, batch number, amount, and quarter end date if applicable. Shred the paper coupons 30 days after imaging.

Monthly Billing and Remittances Proposer is unable to process

The Proposer will sort and bundle Monthly Billing Coupon and Remittances that are unable to be processed. Keep monthly billing and District Tax Office coupons together with other enclosures. Remove all staples. Following are examples of instances when the Proposer may not be able to process:

Monthly billing coupon (5229-1) with no accompanying remittance. Multiple coupons and/or multiple remittances where the sum of the coupons

do not equal the sum of the actual amount remitted. Remittances issued to the wrong payee.

The Proposer shall batch each category in separate batches, not to exceed ninety-nine (99) items per batch. A paper copy of the batch sequence sheet will be placed on each payment batch. Batch numbers will run consecutively for the entire quarterly processing period per Attachment C.

16.2.8. Remittance Processing Details – E-File Payment Coupon Remittances

The Proposer shall open all envelopes and sort E-file Remittances into two categories:

E-File Remittances to be processed by the Proposer E-File Remittances that cannot be processed by the Proposer and must be

delivered to ESD.

Keep E-File Payment coupons with accompanying remittances and other enclosures together.

E-File Remittances to be processed:

Single E-File Payment coupon with a single remittance


Multiple E-File Payment coupons with a single remittance Multiple coupons and/or multiple remittances where the sum of the coupons

equal the sum of the actual amount remitted.

E-File Payment coupon remittances are processed by the Proposer keying the ES reference number, dollar amount, check number, processed date, received date and batch number and quarter end date of the remittance in an electronic file to be transmitted daily to ESD.

If the payment amount entered on the E-File Payment coupon and the actual amount remitted do not agree, the files will be processed manually using ESD standards and policies.

E-File Remittances Proposer is unable to process:The Proposer shall sort and bundle E-File Payment Coupons that are unable to be processed. Keep E-File Payment coupons together with other enclosures. Remove all staples. Following are examples of instances when the Proposer may not be able to process:

E-File Payment coupons with no remittance. Multiple coupons and/or multiple remittances where the sum of the coupons

do not equal the sum of the actual amount remitted.

The Proposer shall process E-File Remittances in batches not to exceed ninety-nine (99) items per batch. A paper copy of the batch sequence sheet will be placed on each payment batch. Batch numbers are to run consecutively for the entire quarterly processing period per Attachment C.

16.2.9. Processing ICESA Remittances

Employers are instructed to send a remittance listing (not to exceed 50 accounts per page) that provides the employer name, ES Reference Number, amount remitted and grand total, along with the corresponding remittances.

The Proposer shall process ICESA Remittances by keying the ES reference number, dollar amount, check number, processed date, received date and batch number of the remittance in an electronic file to be transmitted daily to ESD.

The Proposer shall process ICESA Remittances in batches not to exceed ninety-nine (99) items per batch. Batch numbers are to run consecutively for the entire quarterly processing period per Attachment C.

Exception: If the number of payments in a batch listing exceeds 50 items and is included in the grand total on the page process as a single batchThe Proposer shall image the ICESA remittance listings and the front and back of the checks after endorsement. Send an electronic file of indexes and corresponding images to ESD daily in a format specified by the Department. Indexes will include at a minimum, ES Reference Account Number, received date, processing date, batch number, amount, and quarter end date if applicable. Shred the paper coupons 30 days after imaging.


ICESA Remittances Proposer is unable to process

The Proposer shall sort ICESA checks that are unable to be processed into batches. Keep ICESA listings together with other enclosures. Remove all staples. Following are examples of instances when the Proposer may not be able to process:

If the ES Reference Number is missing or invalid or the payment amount is different than the check on the listing do not process the payment. If a payment has a UBI or FEIN Number on the listing, line out the entry on the listing and initial remittance and do not process the payment.

16.2.10. Remittance Processing Reporting

After remittances have been processed and before the daily file transmission, the Proposer is responsible for ensuring that the daily total amounts for the Account Sequence Listing and the Batch Summary Report are in balance for each type of remittance.

Proposer shall document and report to ESD a Batch Notification that lists the number of batches for each processed payment source and the number of batches for each source that could not be processed by Proposer.

A separate listing of checks that Proposer could not process will be e-mailed to ESD the day prior to the delivery. A copy of that list will be included in the delivery the following day. The listing will contain the check number and amount.

16.2.11. Verification and Delivery

The Proposer shall furnish to ESD Employer Accounts Unit, a document indicating the number of remittances and documents and the total number of boxes delivered, and the dates the deposits were processed.

The Proposer shall fax or e-mail a delivery sheet to ESD the day of delivery. ESD Employer Accounts Unit will count and verify the number of boxes (trays) delivered. If there is a discrepancy in the number of remittances or documents within the boxes, ESD will immediately inform the Proposer for resolution.

ESD will notify the Proposer of any missing trays, documents or batches of returned work. ESD Employer Accounts Section will notify the Proposer of the number of errors identified in working the daily processed and unprocessed work (incorrect ES Reference numbers or amounts or incorrect batch or sequence sheets.

The Proposer shall ensure security, confidentiality and accurate delivery of boxes/documents to ESD from the lockbox facility, guarding against delivery of ESD documents to other Departments or customers of the lockbox bank.

The Proposer shall deliver the following additional items to ESD each workday common to ESD and the Proposer no later than 8:00 a.m. via Proposer’s courier:


Two (2) Audit Advice (Batch Summary Report) copies – one to Employer Accounts and one to ESD Treasurer’s Office.

Deposit recaps Detail report of Quarterly Tax Report payments Detail report of Monthly Payment Coupon payments. All unprocessed items will to be delivered to ESD Employer Accounts

Unit within one working day of receipt by the Proposer.

The courier will pick up and deliver all return documents (including unprocessed items) from the Proposer to ESD on the same day. During the heavy processing period each quarter beginning the 28th day of the first month of each quarter until the 7th day of the second month of each quarter, the courier delivery time will be 7:00 A.M or later than 7:30 A.M. Proposer shall contact ESD to report any delays in delivery.

The Proposer shall deliver the following documents in separate and marked batches with the delivery date from the previous day’s processing. The batch sequence sheet will be attached to each batch of processed payments and an account sequence sheet will be provided for each activity of processed payments.

Tax reports where payments have been processed No Payroll tax reports Unprocessed tax reports with no payment E-File batches processed with payments (batch sequence sheets and

account sequence sheets with delivery. Unprocessed E-File Coupons without payment Unprocessed E-File Coupons with unprocessed payments Monthly Billing Coupons (batch sequence sheets and account sequence

sheets with delivery Unprocessed Monthly Billing Coupons without payment Monthly billing Coupons with unprocessed payments ICESA listings that have been processed ICESA Payments that have not been processed

16.2.12. Lockbox Processing Improvements

ESD is interested in exploring ways to streamline the lockbox process and reduce the cost of lockbox services. Discuss your willingness to participate with ESD in accomplishing this objective. If process changes are immediately apparent upon reviewing the previous description of services, please include such changes in your response.

17. MINIMUM ACCOUNT SERVICES TO BE PROVIDED – TECHNICAL REQUIREMENTS


17.1 Technical Support

17.1.1 The Proposer shall maintain and provide to ESD a fully-functional system test environment and testing process that will enable change and defect testing with ESD without using the production environment or code.

17.1.2 The Proposer shall provide available and knowledgeable representatives to test new applications and the re-testing of existing applications in a test environment.

17.2 Electronic Data Transmission

17.2.1 The Proposer shall work with ESD Information Technology Business Integration (ITBI) to define transfer protocols of all electronic bank and lockbox transmission files. The transfers shall be automated and scheduled per agreement between Proposer and ESD.

17.2.2 The Proposer shall send a daily electronic payment file(s) to ESD in the format and schedule specified by ESD per Attachments E1 through E5.

17.2.3 The Proposer shall provide detailed information with respect to their current data transmission file layout standards, batch schedules, scheduling software, error handling, and method of securing data both at rest and in transmission. The Proposer shall also provide details of their technical support model and process for notifying ESD of technical errors and file failures and the Proposer’s standards for issue resolution.

17.2.4 Examples of ESD’s current interfaces files can be found in Attachments E1 through E5. ESD will work with the Apparently Successful Proposer to finalize the interface specifications, scheduling and transmission processes during elaboration of the requirements.

17.2.5 Provide a method for ESD to request a reversal or deletion of an entire file. Include security procedures to ensure/verify that only authorized individuals from ESD request the reversal or deletion. Provide reports that confirm the reversal or deletion was completed. Include immediate origin, debit totals and the effective entry date of the deleted or reversed file in the report. Provide a mechanism to ensure that records will not be duplicated due to file reprocessing.

17.2.6 The following interfaces must be developed and maintained by the Proposer for ESD’s Benefits and Employer Tax and Wage applications:

Bank Automated Clearinghouse Automated Clearinghouse Returns BAI2 – Receiving and processing Bank Deposits for daily reconciliation Lockbox and Paper Check Processing Services Reconciled Payments Unreconciled Payments Image files for both Reconciled and Unreconciled Payments Pre-Paid Debit Card Payments Warrants


Redeemed Warrants Overpayment File

17.2.7 The Proposer shall monitor all files to ensure they are processed in a timely manner. Provide automated validation to ESD that all files are received or processed by the Proposer.

17.2.8 The Proposer shall contact designated ESD personnel in the event of a file transmission error or other processing issue within two (2) hours of the event occurring. Ensure 24-hour technical and customer support.


SECTION IV: PROPOSAL REQUIREMENTS

Proposals must conform to the information and attachments provided, including any amendments made to the RFP and ESD’s responses to questions. Proposers must address each of the following parts in the same order listed to be considered responsive. Proposals should be concise with emphasis placed on completeness and clarity of content. Proposers must consider the required services outlined in SECTION III – SCOPE OF SERVICES in formulating responses. Proposals shall include the following information by section:

1. COVER LETTER: Provide a cover letter, signed and dated by an individual legally authorized to bind the Proposer contractually. Indicate that the signer is authorized to commit the Proposer to the terms presented and include the title or position the signatory holds. The letter must also include:

A statement that all terms and prices included in the Proposal are guaranteed for 180 Calendar Days from the Proposal due date.

A statement confirming the Proposer meets the requirements described in Error:Reference source not foundSECTION II.

A statement that the Proposer has read and fully understands the RFP requirements, terms and conditions, and has asked questions and received satisfactory answers from ESD regarding any provision of the RFP with regard to which the Proposer desired clarification.

2. TABLE OF CONTENTS: Include a table of contents showing the Proposals content and sequence. All pages should be numbered, and each section must reference the corresponding part listed in this section.

3. GENERAL INFORMATION: Provide the following information:

Name, mailing address, telephone number, and fax number of the Proposer Name, title, mailing address, telephone number, and e-mail address of principal officers.

4. EXECUTIVE SUMMARY: Provide a brief, concise overview of the key points in the Proposal. The summary should not exceed five pages.

5. PROPOSER INFORMATION: Describe the Proposer’s qualifications and relevant experience during the past three years providing banking, prepaid debit card and lockbox services, including ACH, wire, warrant processing, and lockbox services for government and public sector entities.

6. AUDIT REPORT: Provide a copy of the Proposers most recent Independent Service Auditor’s Report prepared in accordance with attestation standards established by the American Institute of Certified Public Accountants for services provided in a banking services capacity.

7. PERSONNEL: Identify the specific individuals (or subcontractors) who will be assigned to ESD’s account. Describe their qualifications in terms of their education and experience with


larger state and local government clients. Indicate the nature of the experience (e.g. set up new ACH applications, implemented prepaid card program, managed the check processing proof Department, warrant processing, lockbox applications, etc.) Attach a brief résumé of each individual. Include an organization chart that reflects management of administrative and operational services within the Proposer’s organization.

8. SERVICES PERFORMED: Describe the services the Proposer is willing to provide. The Proposal should be presented in the same order as listed in SECTION II: MINIMUM QUALIFICATION REQUIREMENTS and SECTION III: SCOPE OF SERVICES. Proposers must reiterate the number and full text of each subsection, followed immediately with their description of how their services meet the stated requirement(s). Product samples, where applicable to the response, should be included by reference to a separate appendix. A response of “will comply” or “meets the requirement” is not sufficient and will be deemed non-responsive. Please submit a definitive description of the resources available and other pertinent factors to demonstrate your ability to perform the requested services. If any service outlined in SECTION III cannot be provided, the Proposer should specifically state this in that section and provide any proposed alternatives.

Any amendments or addenda proposed by the Proposer shall be submitted with its Proposal.

Note: 1. Responses should address the services described in SECTION III: SCOPE OF

SERVICES in its entirety.

2. No part of the work to be performed will be subcontracted or assigned to another firm without prior written consent by ESD. It is ESD’s preference that the banking, prepaid debit card and lockbox services are all provided by a single Proposer.

9. PROPOSED FEES CHARGED TO ESD: Proposers must complete Attachment B, Pricing Schedule, including all fees proposed.

Provide a price for the minimum account services requested for the specific account or accounts noted in SECTION III in accordance with the volumes as detailed in Attachment B.

Include corresponding BAI codes where possible for all charges when completing the Pricing Schedule.

Specify if the figure is a total amount or per unit amount.

Calculated total amount should be carried over to the “Total” column.

Detail any additional costs for “other” or “innovation/future” services, if any, including but not limited to research charges and pass-through fees.

Discuss any creative pricing or payment options that you can provide.

Note: All charges must be detailed here. Any charges not listed in this section of the Proposer’s Proposal will not be allowed during the course of the Agreement unless the scope of the Agreement is expanded to include additional services not requested herein and is otherwise negotiated and agreed to in a written amendment to the Agreement.


Any pricing offered by Proposer shall be inclusive of sales tax, business and occupation tax, and any other taxes for fees for doing business in the State of Washington that may apply.

All travel and per diem will be the responsibility of the Proposer and should be considered when preparing the Proposed Fee. No separate allowances or fees will be paid for travel or per diem for the Proposer.

The evaluation process is designed to award this procurement not necessarily to the Proposer with the least cost, but rather to the Proposer whose Proposal best meets the requirements of this RFP in ESD’s sole judgment.

10. PREPAID CARDHOLDER FEES: Proposers must submit a comprehensive, clearly outlined schedule of costs to prepaid cardholders including, but not limited to:

Methodology to determine fee schedule The difference between service vs. surcharge fees and the instances when either

are applied The definition of “in network” vs. “out of network” and associated fees Examples (usage fees; balance check fees; lost card/replacement fees; cash back

w/purchase fees; out of network fees, etc.)

Proposer shall complete the ‘Prepaid debit card’ section of Attachment Band indicate which fees are applied to the cardholder vs. ESD.

11. BRANCH & ATM LOCATIONS: Proposers shall provide ESD with a complete list as well as a Washington State map showing the following:

Branch locations ATM locations

o In-network siteso Partner/Co-op sites

12. SOFTWARE APPLICATION: List any applications that require installment of component(s) on ESD’s desktops and provide a detailed description of the component(s). List any applications that are accessed solely through a web browser.

13. DISASTER RECOVERY / BUSINESS CONTINUITY: Describe the procedures and provisions you have implemented to be employed in the event of a disaster or equipment failure at your primary processing site(s). Describe your business continuity plans should the region experience a geographic disaster.

14. INNOVATION / FUTURE SERVICES: ESD expects the apparently successful Proposer to work in partnership with ESD as it explores automation and innovative service delivery options. Financial institutions are encouraged to recommend the use of new and innovative technologies that will provide improved service and/or operational savings when formulating a response. The introductions of new technologies and services can occur at any time during the contract term.

New technologies and services could include but are not limited to: Emergency replacement of lost/stolen card at bank branch Incentive and/or perks offered to ESD debit cardholders Ways to improve/streamline/reduce costs of the lockbox process Other Electronic commerce options Online, walk-in and/or other payment solutions


Please describe alternate or innovative approaches to the requested services where feasible or additional creative technology and service solutions offered that might not be specifically requested.

ESD expects the selected Proposer to stay abreast of trends within this industry and to work with the Department as it explores Electronic commerce options.

15. REFERENCES: Provide contact names, addresses and telephone numbers for at least three (3) entities the Proposer has a current relationship with. ESD prefers references from state or local governments or institutions of higher education to which the Proposer currently provides Banking, Prepaid Debit Card and/or Lockbox services.

16. CONFLICT OF INTEREST: It is the expectation of ESD that the award of a contract for Banking, Prepaid Debit Card and Lockbox Services and the conduct of business under that contract will comply with ESD’s conflict of interest laws. Provide a letter signed by an officer of your company certifying that no condition exists with respect to the Proposer or any of its employees which violates the Ethics in Public Service Act, Chapter 42.52 RCW, or any similar statute in relation to the submittal of its Proposal.

17. LITIGATION: Provide a brief explanation and status of any material litigation, regulatory authority investigation, contingent liabilities, or other legal proceedings involving the Proposer or any officer or principal during the past three years.

18. DATA PROTECTION: Describe the Proposer’s policies and procedures to protect and safeguard personally identifiable information.

19. CONTRACTUAL REQUIREMENTS: Attachment A – Agreement for Employment Security Banking, Prepaid Debit Card and Lockbox Services contains contracting terms ESD requires in the Agreement that are not negotiable. Provide a statement indicating the Proposer has read Attachment A and accepts all provisions.

The Proposer may propose revisions to Agreement for clarification and procedural purposes only. If a conflict exists between ESD’s required language and language proposed by the Proposer, the provisions required by ESD shall govern. However, ESD retains the right to waive any provisions, as deemed necessary. Proposals contingent upon revising the intent of the Agreement will be rejected.

Any proposed revisions to the Agreement by the Proposer shall be submitted with its Proposal. However, a Proposer should not submit its own standard contract terms and conditions that conflict with ESD’s terms and conditions as a response to this RFP.

20. TRANSITION: Provide a complete transition plan that addresses how the Proposer would manage a transfer of banking and lockbox services, and the implementation of a new prepaid debit card program to/from your financial institution, and what steps are necessary to ensure an orderly transition of records and functions on behalf of ESD. Discuss the process, tasks and phases considered necessary. Include the Proposer’s employees involved in the transition process, and the level of involvement anticipated by ESD employees and ESD’s current banking and lockbox service provider.

The successful Proposer shall guarantee that the necessary resources will be committed to the conversion process to ensure that the transition is performed in a timely manner, requested


services are tested and operational no later than the date of the contract period, July 1, 2015. Note: ESD is considering a phased in approach whereby the core banking services must be implemented effective July 1, 2015. A second phase, if necessary, would include the transition of lockbox services and implementation of a prepaid card program by a date not later than October 1, 2015.

21. LIST OF EXCEPTIONS: Provide an explanation for any exceptions to, or deviations from, the requirements of the RFP. If there are no exceptions, include a statement to that effect.

22. ADDITIONAL INFORMATION: Provide any additional pertinent information, if necessary.


SECTION V: PROPOSAL SUBMISSION

Proposals should only include information essential to meet the requirements of the RFP. The detailed requirements stated in the SECTION IV: PROPOSAL REQUIREMENTS, presented in the same order as listed, are mandatory. Failure to respond to specific requirements may be the basis for elimination from further consideration.

DELIVERY: Six (6) paper copies of your Proposal must be delivered or mailed to the following address. One (1) paper copy must have original signatures and five (5) paper copies can have photocopied signatures. The copy containing original signatures must be unbound and must be marked “Master Copy.” Proposals must be submitted with tabs separating the major sections of the Proposal (See SECTION IV- PROPOSAL REQUIREMENTS). Proposals must be clearly marked “Proposal for ESD Banking, Prepaid Debit Card and Lockbox Services.”

Lori Pierce, Contracts SpecialistEmployment Security Department212 Maple Park Avenue SEPO Box 9046Olympia, WA 98507-9046

ELECTRONIC COPY: Proposer shall also submit one (1) electronic copy of the Proposal on a compact disk or DVD, in either Adobe Acrobat (.pdf), or Microsoft Word (.doc) format. The electronic copy must be an exact duplicate of the submitted paper “master copy”. Attachment B must be in Excel format with the formulas included. It is the sole responsibility of the Proposer to ensure receipt of Proposals by the specified date and time and at the specified location.

DEADLINE: Proposals must be received by 3:00 P.M., PT, Wednesday, December 31, 2014. Proposals received after the deadline will not be accepted.

ERRORS IN PROPOSAL: ESD will not be liable for any errors in Proposals received. Proposers will not be allowed to correct, amend, or resubmit Proposals after the submission deadline. ESD reserves the right to make corrections or amendments to a response due to errors identified by ESD or the Proposer. This type of amendment will only be allowed for such errors as typing, transposition, omission, or any other obvious error. All changes must be coordinated in writing with, authorized by, and made by the RFP Coordinator. Proposers are liable for all errors or omissions contained in their responses.

PROPRIETARY OR CONFIDENTIAL INFORMATION: All Proposals, including attachments and other inclusions, become public records subject to the public disclosure law of the state of Washington upon receipt by ESD. Proposals shall be deemed dis-closable pursuant to Chapter 42.56 RCW, the Public Records Act, except as exempted by law. Proposers should clearly mark materials claimed to be exempt from disclosure as “confidential.” Marking the entire Proposal or an entire section of the proposal as proprietary or confidential will be neither accepted nor honored. The Proposal’s cover letter should identify specific material claimed to be exempt, corresponding page number(s), and a statement of basis for each claim.

If ESD receives a request to view a Proposer’s Proposal, ESD will respond in accordance with applicable law and ESD’s policy governing public disclosure. If any requested information marked as “confidential” does not in ESD’s sole judgment clearly meet one of the enumerated exemptions from disclosure, ESD will give notice of the request to the affected Proposer that the material will


be made available in ten (10) business days unless the affected Proposer obtains a court order restraining ESD from disclosing such information.

Failure to label materials as “confidential” or failure to timely respond after notice of request has been given shall be deemed a waiver by the Proposer of any claim that such materials are exempt from disclosure.

INCURRED COSTS – ESD will not reimburse Proposers for any costs associated with preparation or submittal of any Proposal or for any travel and/or per diem expenses incurred in any presentations of such Proposals.


SECTION VI: SELECTION PROCESS

Proposals will be evaluated strictly in accordance with the requirements set forth in this RFP and any addenda issued. Evaluators will consider how well a Proposal meets all such requirements. Responses must be clear, complete, and presented in the order specified so evaluators can adequately understand all aspects of the Proposal. Proposers that submit incomplete Proposals will be eliminated from further consideration.

ESD will select the apparent successful Proposer based on the Proposal that, in ESD’s opinion, best meets the RFP requirements and is in the best interest of ESD.

EVALUATION COMMITTEE – All Proposals will be reviewed by the Evaluation Committee. The committee will consist of ESD and OST personnel familiar with the services requested. The committee will consider how well the Proposer’s Proposal meets all requirements as described.

EVALUATION PROCESS – The Evaluation Committee will evaluate Proposals based on their technical merits and cost factors.

After the initial evaluation of responses and prior to the final award of a contract, the Evaluation Committee may select finalists for oral interviews. Oral interviews, if deemed necessary, are tentatively scheduled for January 21-22, 2015. The presentation will be limited to the material contained in the Proposer’s Proposal, with the limited exception that a Proposer may address specific questions posed by the Evaluation Committee or provide clarification of information contained in its proposal. Such presentations will be at the Proposer’s expense. At the sole discretion of ESD, such interviews or presentations will take place either at the Employment Security Department in Olympia, Washington, or at the offices of the finalists.

EVALUATION CRITERIA – The following criteria, not listed in order of significance, including but not limited to the following will be used to evaluate Proposals.

Compliance with RFP requirements Proposer’s qualifications and experience in providing required services Qualifications and relevant experience of personnel assigned to this engagement Cost of services References/Past Performance

These criteria, combined with information obtained from interviews and other sources, if any, will be used to determine the successful Proposer.

Note: Cost will not be the sole determining factor in the selection.

ADDITIONAL REQUESTS: The Evaluation Committee reserves the right, during this process, to request additional information. Proposers will be given at least five (5) business days from notification to provide requested information.

RIGHTS OF ESD: In addition to any other rights stated in this RFP, ESD reserves the right to (i) reject any and all Proposals, (ii) waive any minor informalities in a Proposal, (iii) schedule interviews, (iv) request clarification or additional information from any Proposer, (v) waive specific terms and conditions contained in this RFP, and (vi) effect any agreement deemed by ESD to be in the Department’s best interest.


CONTRACT AWARD: The Proposer selected as a result of the Proposal evaluation process will be, in the sole judgment of ESD, the Proposer whose Proposal is the most advantageous to ESD.

ESD will notify the selected Proposer of its acceptance of the Proposer’s Proposal and of ESD’s intent to enter into the Agreement in substantially the same form as the Agreement attached as Attachment A to this RFP. If said Proposer does not execute the Agreement within three weeks of notification, ESD may withdraw the award from that Proposer and award the Agreement to the Proposer ranked second in the Proposal evaluation process.

SINGLE PROPOSAL: If ESD receives only one Proposal to this RFP, ESD, at its sole option, may elect to cancel this RFP or select and award the contract to the single Proposer.

PUBLICITY: The apparent successful Proposer shall not release any notices, press releases, reports, or news or make any statement to the public, press or other media relating to matters pertinent to the Proposal or contract without prior written approval from ESD.

PROTEST PROCEDURES: In the event a Proposer protests this RFP process or the selection of an apparent successful Proposer, the Proposer shall follow the procedures set forth in RCW 39.26.170. Protests shall be resolved in accordance with above referenced WAC.


ATTACHMENT A - AGREEMENT STANDARD TERMS AND CONDITIONS

AGREEMENT

FOR

BANKING, PREPAID DEBIT CARD AND LOCKBOX SERVICES

KXXXX

DATE

WASHINGTON STATEEMPLOYMENT SECURITY DEPARTMENT


This Agreement Number KXXXX for Banking, Prepaid Debit Card, and Lockbox Services is entered into by and between the Washington State Employment Security Department, hereinafter referred to as ESD, and ________________ ______________________, a corporation, licensed to do business in the State of Washington, hereinafter referred to as Vendor.

ARTICLE I. RECITALS

17.1. The Washington State Employment Security Department, acting by and through the Office of the State Treasurer of the State of Washington, issued a Request for Proposal (RFP), dated (Date), for the purpose of soliciting vendors interested in providing proposals for Banking, Prepaid Debit Card, and Lockbox Services.

17.2. Vendor submitted a timely proposal to the RFP. ESD evaluated all properly submitted proposals to the RFP and selected the proposal of the Vendor.

17.3. ESD is authorized through the Office of the State Treasurer of the State of Washington to enter into this Agreement under RCW 43.08.015.

NOW, THEREFORE, in consideration of the covenants contained herein and for the other goods and valuable consideration, the receipt and adequacy of which are hereby acknowledged, ESD and Vendor agree as follows:

ARTICLE II. DEFINITIONS

All capitalized terms used in this Agreement but not expressly defined herein, have the respective meanings set forth below:

“Agreement” shall mean this Agreement for Banking, Prepaid Debit Card and Lockbox Services, including but not limited to all exhibits and attachments hereto, and any subsequently adopted amendments.

“Business Day” shall mean each day on which the Vendor or Vendor office providing or facilitating a service is open for business related to that service.

“Calendar Day” shall mean a day reckoned from midnight to midnight.

“Federal” shall mean the United States government.

“Laws and Regulations” shall mean all applicable laws, codes, ordinances, rules, restrictions, regulations, and orders of the Federal, State, regional, or any local government, and any judicial or administrative order or decree that are in effect as of the effective date of this Agreement or any time thereafter.

“Banking Services” (may also be referred to as “Services”) shall mean Work performed by the Vendor as detailed in this Agreement, including but not limited to the Work specified in Exhibit A, Scope of Services, all associated support services, training, maintenance, Products, and all reports and documents specified herein.November 2014 RFP:ESD-2014-018

“ESD Contract Manager” shall mean the ESD Treasury manager or designee who has been appointed to administer this Agreement on behalf of the Washington State Employment Security Department.

“ESD Contract Administrator” shall mean the ESD Director of Financial Services, as the designated contracting officer of this Agreement.

“Products” shall mean all reports, documents, and equipment provided by Vendor under this Agreement, including but not limited to hardware, Software, devices, and documentation.

“RCW” shall mean the Revised Code of Washington.

“RFP” shall mean the Request for Proposal (RFP) XXXX-XXX for Banking, Prepaid Debit Card and Lockbox Services issued by the Washington State Employment Security Department dated (Date).

“RFP Response” shall mean Vendor’s proposal in response to the RFP.

“Service(s)” shall have the same meaning as the term “Banking Services” as defined in this Section.

“Service Period” shall mean the calendar month in which the Services were provided.

“Software” shall mean computer instructions, including but not limited to, programs, routines, functions, libraries, and data bases, supplied, procured or developed by Vendor in connection with the performance of the work. Software also includes all prior, current, and future versions of the Software and all maintenance updates and error corrections. Software does not include embedded code, firmware, internal code, micro code, and any other term referring to software residing in the equipment that is necessary for the proper operation of the equipment.

“Specified Service Requirements” shall mean the services to be delivered in the Scope of Services, Exhibit A.

“State” shall mean the State of Washington.

“Subcontractor” shall mean one not in the employment of the Vendor, who is performing all or part of those Services under this Agreement under a separate contract with the Vendor. The term “subcontractor” means subcontractor(s) of any tier.

“Vendor” shall mean _____________________with whom ESD is contracting for Banking Services, Prepaid Debit Card and Lockbox Services, and includes any subsidiary, affiliate, agent, subcontractor, representative or employee retained by the Vendor as permitted under the terms of this Agreement.

“Vendor’s Account Manager” shall mean an employee of the Vendor who is assigned as the primary contact person with whom the ESD Contract Manager shall work for the duration of this Agreement.


“WAC” shall mean the Washington Administrative Code.

“Work” shall mean all Products and Services required to be provided or performed by Vendor under this Agreement.

ARTICLE III. TERM AND EXTENSIONS

17.4. TermThe initial term of this Agreement shall be for the period commencing (Date) and ending (Date).

17.5. ExtensionsUpon the mutual written agreement of ESD and the Vendor, this Agreement may be extended for an additional three and three quarter (3-3/4) year period, or any portion thereof, whereby the total contract term with extensions shall not exceed seven (7) years; Provided that, ESD reserves the right to extend this Agreement beyond seven (7) years in the event ESD determines an extension is in the best interest of the state

{Include the following provision if the vendor is a new Vendor}

17.6. Additional Transition Term

The term of the Agreement will include an additional transition period that shall commence _____________ and terminate no later than (Date).

ARTICLE IV. PRICING, INVOICES AND PAYMENTS

17.7. Advanced Payments Prohibited

No advance payment shall be made for Services or Products furnished or performed by the Vendor pursuant to this Agreement.

17.8. Prices

1.1.1. Price: The Vendor agrees to provide the Services and Products at the costs, rates and fees set forth in Exhibit B Pricing Schedule. No other costs, rates, or fees shall be payable to the Vendor, except for those mutually agreed to and attached to this Agreement as an amendment.

1.1.2. Price Increases: The prices as set forth in Section 4.2.1 may not be increased during the initial period of this Agreement. Prices and terms are subject to renegotiation at the inception of any extension period. Any modification in the prices or terms shall be set forth in a written amendment to this Agreement, executed by both parties.


17.9. Taxes

1.1.3. Vendor will pay sales and use taxes, if any imposed on the products and services acquired hereunder. Vendor must pay all other taxes including, but not limited to, Washington Business and Occupation Tax, other taxes based on Vendor’s income or gross receipts, or personal or real property taxes levied or assessed on Vendor’s personal or real property.

1.1.4. Vendor shall complete registration with the Washington State Department of Revenue and be responsible for payment of all taxes due on payments made under this Agreement.

1.1.5. All payments accrued on account of payroll taxes, unemployment contributions, any other taxes, insurance or other expenses for the Vendor or Vendor’s staff shall be the sole liability of the Vendor.

17.10. Damages for Lost Opportunity

If the Vendor does not meet the specified Service requirements as detailed in Article V of this Agreement, and ESD incurs lost opportunity costs, the Vendor shall be required to negotiate a settlement with the ESD Contract Administrator for an appropriate reduction in charges and/or compensation for lost opportunity costs. Lost opportunity compensation shall be calculated using the effective Federal Funds Rate times the total amount of the funds that were not available to ESD on a per day basis. Compensation shall be paid through a credit to the accounts unless otherwise negotiated.

17.11. Invoice and Payment

1.1.6. Payments made by ESD to Vendor are full compensation for all labor, Products, and Services. No additional compensation will be available, except by executed Amendment(s) to this Agreement.

1.1.7. The ESD shall pay the Vendor for Service and Products in accordance with the Pricing Schedule set forth in Exhibit B after ESD verifies all activity and charges of the invoice. Payment will be made monthly. Payment shall be considered timely if made by ESD within thirty (30) Calendar Days after receipt of a properly completed invoice.

1.1.8. Vendor shall submit properly itemized invoices to ESD in hard copy duplicate and provide an electronic copy of each invoice (.pdf). Invoices shall provide and itemize, as applicable, any allowable fee from Exhibit B that is incurred during each invoicing period.

1.1.9. ESD may withhold from Vendor’s payment any amounts Vendor owes ESD under this Agreement, provided that ESD has previously given Vendor notice of such owed amounts.

1.1.10. Incorrect or incomplete invoices will be returned by ESD to Vendor for November 2014 RFP:ESD-2014-018

correction and reissue.

1.1.11. In the event an overpayment is made to Vendor under this Agreement, Vendor shall refund to ESD the full amount of any such erroneous payment or overpayment within thirty (30) Calendar Days of the date of the written notice of such erroneous payment or overpayment, as issued by ESD. If Vendor fails to refund the erroneous payment or overpayment within that thirty (30) day period, ESD may charge late payment fees as set forth in Section 14.13 herein. The provisions in this Section shall survive the expiration or termination of this Agreement.

ARTICLE V. SCOPE OF WORK

17.12. Service SpecificationsThe Vendor agrees to provide Banking, Lock Box, Prepaid Debit Card Services and other services as ESD may request, as detailed in Exhibit A Scope of Services, and the terms of this Agreement and any amendments hereto.

17.13. Guarantee of VolumesSince transaction volumes may be impacted by new technology or legislative changes, ESD cannot guarantee transaction volumes over the life of this Agreement. The Vendor agrees the transaction volumes provided in the RFP are not guaranteed over the life of the Agreement.

17.14. Products

The Vendor agrees to provide the Products, including but not limited to equipment and Software, as detailed in Exhibit A Scope of Services, and the terms of this Agreement and any amendments hereto.

ARTICLE VI. SUBCONTRACTING


17.15. Vendor may, with prior written permission from the ESD Contract Administrator, enter into subcontracts with third parties for its performance of any part of Vendor’s duties and obligations. In no event shall the existence of a subcontract operate to release or reduce the liability of Vendor to ESD for any breach in the performance of Vendor’s duties or obligations. For purposes of this Agreement, Vendor agrees that all Subcontractors shall be held to be agents of Vendor; Provided, that Subcontractors shall not have the right to amend this Agreement or make any other binding commitment on Vendor. Vendor shall be liable for any loss or damage to ESD, including but not limited to personal injury, physical loss, harassment of ESD employees, or violations of applicable Sections of this Agreement occasioned by the acts or omissions of Vendor’s Subcontractors, their agents or employees.

17.16. Vendor is solely responsible and liable for ensuring that the applicable terms and conditions set forth in this Agreement are incorporated into any partnering or subcontracting relationships with other entities for Work related to this Agreement. Liability includes management responsibility and quality assurance for Work performed and financial responsibility for payments to and by partner organizations or Subcontractor to others.

17.17. For Work to be performed for ESD, ESD reserves the right to reject any of Vendor’s employees, suppliers, or Subcontractors with due cause. Any and all costs or expenses associated with replacement of any person or entity shall be borne by Vendor.

ARTICLE VII. CONTRACT MANAGEMENT AND ADMINISTRATION

17.18. Notices

1.1.12. Any notice or demand which, under this Agreement or applicable law, must or may be given by the Vendor, or ESD, shall be in writing, properly addressed and, as an alternative to personal delivery, made by the most expeditious means available, with regard given to the time sensitivity of notice or demand being made to the addresses below or to such other address as may be specified in writing, from time to time, by either party, by written notice to the other party.

To the Vendor: To ESD:

Washington StateEmployment Security DepartmentAttention: Sandi Triggs, Director of Financial ServicesPO Box 9046Olympia, WA 98507-9046

1.1.13. Any such notice or demand may be transmitted via facsimile or email, provided that written notice as provided above is also given. For purposes of facsimile or email transmissions, the parties shall use the following numbers, or email addresses, or others, if notice of change is given to the other party:


Employment Security Department: Fax: 360.902.9315Email: [email protected]

Vendor: Fax: _______________Email: _______________

1.1.14. Notwithstanding the foregoing, the service of legal documents shall be made in the manner prescribed by applicable law.

1.1.15. Vendor agrees to accept service of process at the address provided herein, or any modifications thereto; Provided, that such address is located in the State of Washington. Otherwise, the Vendor designates the Secretary of State of Washington as an agent for the purpose of service of process. Such service shall be deemed personal service.

1.1.16. The provisions in this Section shall survive the expiration or termination of this Agreement.

17.19. ESD Contract Manager.

ESD shall appoint an individual who will be the ESD Contract Manager for this Agreement and will provide oversight of the activities conducted hereunder. The ESD Contract Manager will manage this Agreement on behalf of ESD, and will be the principal point of contact for the Vendor concerning the Vendor’s performance hereunder. ESD shall notify the Vendor, in writing, when there is a change in staffing and a new ESD Contract Manager is assigned to this Agreement. At the time of execution of this Agreement, the ESD Contract Manager information is:

Carl Roper, ESD Treasury ManagerPhone: 360.902.9401Email: [email protected] Box 9046Olympia, WA 98507-9046

17.20. Vendor’s Account Manager

The Vendor shall appoint an individual who will be the Vendor Account Manager for this Agreement who will provide direct oversight of Vendor’s activities conducted under this Agreement. The Vendor’s Account Manager will be the principal point of contact for ESD concerning the Vendor’s performance under this Agreement. The Vendor’s Account Manager will also serve as the focal point for business matters, support coordination, and administrative activities. The Vendor shall notify ESD, in writing, if a new Vendor Account Manager is assigned.

17.21. ESD Contract Administrator.ESD shall appoint an ESD Contract Administrator for this Agreement who is designated as the ESD employee to receive legal notices, and to administer, amend, or terminate this Agreement. ESD shall notify Vendor, in writing, when there is a new ESD Contract


Administrator assigned to this Agreement. At the time of execution of this Agreement, the ESD Contract Administrator information is:

Sandi Triggs, Director of Financial ServicesEmail: [email protected] Box 9046Olympia, WA 98507-9046

ARTICLE VIII. VENDOR RESPONSIBILITIES

17.22. Licensing and Accreditation Standards.Vendor shall comply with all applicable local, State, and Federal licensing, accreditation and registration requirements and standards necessary in the performance of this Agreement.

17.23. Industrial Insurance Coverage

The Vendor shall provide or purchase applicable industrial insurance coverage prior to performing work under this Agreement. ESD shall not be responsible for payment of industrial insurance premiums for the Vendor, or any subcontractor or employee of the Vendor, which might arise under the industrial insurance laws during performance of duties and services under this Agreement. Should the Vendor fail to secure industrial insurance coverage or fail to pay premiums on behalf of employees, ESD may deduct the amount of premiums owing from the amounts payable to the Vendor under this Agreement and transmit the same to the appropriate industrial insurance fund.

17.24. Compliance Requirements.Vendor shall comply with all applicable Laws and Regulations, including but not limited to all environmental requirements, and all applicable nondiscrimination laws and regulations, including but not limited to: Title VI, Non-Discrimination, Title 49 C.F.R., Part 21 and Title VII of the Civil Rights Act; 42 U.S.C. § 12101 et seq., the Americans with Disabilities Act; and Title 49.60 RCW, Washington Law Against Discrimination. In the event of Vendor’s noncompliance or refusal to comply with any nondiscrimination law, regulation or policy, ESD may terminate this Agreement, in whole or in part, and/or declare the Vendor ineligible for other contracts with State.

17.25. Conflict of Interest

1.1.17. The Vendor warrants that it presently has no interest and shall not acquire any interest, direct or indirect, which would conflict in any manner or degree with the performance of services required under this Agreement.

1.1.18. The Vendor shall notify ESD of any potential conflict of interest with the performance of Services required under this Agreement resulting from the provision of services to other customers. If such conflict cannot be resolved to ESD’s satisfaction, ESD reserves the right to terminate this Agreement.


17.26. Confidentiality of Documents and Records

1.1.19. The Vendor acknowledges that some of the material and information that may come into its possession or knowledge in connection with this Agreement, or its performance, may consist of information that is exempt from disclosure to the public or other unauthorized persons under state or federal statutes (“Confidential Information”). Confidential Information includes, but is not limited to, individual names, addresses, Social Security numbers, e-mail addresses, telephone numbers, financial profiles, bank account information, credit card information, driver’s license numbers, medical data, law enforcement records, or information identifiable to an individual that relates to any of these types of information. The Vendor agrees to hold Confidential Information in strictest confidence and to not make use of Confidential Information for any purpose other than the performance of this Agreement, to release it only to authorized employees or Subcontractors requiring such information for the purposes of carrying out this Agreement, and not to release, divulge, publish, transfer, sell, disclose, or otherwise make the information known to any other third party without ESD’s prior and express written consent or as otherwise provided by law. Vendor agrees to implement physical, electronic, and managerial safeguards to prevent unauthorized access to Confidential Information. Such safeguards include, but are not limited to, assuring that each employee, each Subcontractor, and each Subcontractor’s employee is informed of and required to abide by the confidentiality requirements contained this Agreement.

1.1.20. The Vendor agrees to hold all such material and information in strictest confidence, not to make use thereof other than for the performance of this Agreement, to release it only to authorized employees requiring such information, and not to release, sell or disclose it to any other party.

1.1.21. ESD reserves the right to monitor, audit, or investigate the use of Confidential Information collected, used, or acquired by the Vendor through this Agreement. The monitoring, auditing, or investigating may include, but is not limited to, salting databases.

1.1.22. Notwithstanding anything apparently to the contrary in the preceding provisions of this Section, the Vendor may release the material and information described in this Section to its internal and external auditors (whether employees of the Vendor or others) for official use and may also release it pursuant to a subpoena or other order issued by a court of competent jurisdiction, or pursuant to a request made by any regulatory body having regulatory authority over Vendor. The Vendor shall promptly notify ESD of any such subpoena or order upon its receipt.

17.27. Publicity.

1.1.23. The award of this Agreement to Vendor is not in any way an endorsement of Vendor or Vendor’s products by ESD and shall not be so construed by Vendor


in any advertising or other publicity materials.

1.1.24. Vendor agrees to submit to ESD all advertising, sales promotion, and other publicity materials relating to this Agreement or any Product furnished by Vendor wherein ESD’s name is mentioned, language is used, or Internet links are provided from which the connection of ESD’s name therewith may, in ESD’s judgment, be inferred or implied. Vendor further agrees not to publish or use such advertising, sales promotion materials, publicity or the like through print, voice, the World Wide Web, and other communication media in existence or hereinafter developed without the express written consent of ESD prior to such use. Nothing herein shall preclude Vendor from citing the Work performed under this Agreement in resumes or proposals for future work with ESD or other entities.

1.1.25. The provisions in this Article shall survive the expiration or termination of this Agreement.

ARTICLE IX. COMMITMENTS, WARRANTIES AND REPRESENTATIONS

17.28. Any written commitment by the Vendor within the scope of this Agreement shall be binding upon the Vendor. Failure of the Vendor to fulfill such a commitment may constitute breach of this Agreement and shall render the Vendor liable for damages due ESD under the terms of this Agreement.

17.29. For purposes of this Agreement, a commitment by the Vendor, which must be in writing, includes: (1) prices and options committed to remain in force over a specified period(s) of time; (2) any warranty or representation made by the Vendor and as incorporated into this Agreement as to Service performance; (3) any modification of or affirmation or representation as to the above which is made by Vendor in writing whether or not incorporated into a formal amendment to this Agreement; and (4) any representation by the Vendor in this Agreement, supporting documents or amendments thereto as to Services performed.

ARTICLE X. INDEMNFICATION AND LIMITATIONS OF LIABILITY

17.30. Hold Harmless

1.1.26. The Vendor, its successors and assigns, will protect, save, and hold harmless ESD, its authorized agents and employees, from all claims, actions, costs, damages, or expenses of any nature whatsoever by reason of the acts or omissions of the Vendor, its assignees, agents, Subcontractors, licensees, invitees, employees, or any person whomsoever, arising out of or in connection with any acts or activities related to this Agreement. The Vendor further agrees to defend ESD, its agents or employees, in any litigation, including payment of any costs or attorney’s fees, for any claims or actions commenced, arising out of, or in connection with acts or activities related to this Agreement. This obligation shall not include such claims, actions, costs, damages, or expenses which may be caused by the sole negligence of ESD or its authorized agents or


employees; provided, that if the claims or damages are caused by or result from the concurrent negligence of (a) ESD, its agents or employees and (b) the Vendor, its assignees, agents, Subcontractors, licensees, invitees, or employees, this indemnity provision shall be valid and enforceable only to the extent of the negligence of the Vendor or its assignees, agents, Subcontractors, licensees, invitees, and employees.

1.1.27. To the extent authorized by law, ESD agrees to hold harmless the Vendor from all claims, actions, costs or damages caused by acts or omissions of ESD or its employees arising out of or in connection with the authorized acts or activities of ESD or its employees in the performance of this Agreement. This obligation shall not include such claims, actions, costs or damages which may be caused by the sole negligence of the Vendor or its subsidiaries, affiliates, agents, Subcontractors, representatives or employees. Provided, that if the claims or damages are caused by the concurrent negligent of ESD and the Vendor, this provision shall be enforceable only to the extent of the negligent conduct of ESD, or its employees.

17.31. Personal Liability

It is agreed by and between the parties hereto that in no event shall any official, officer, employee or agent of ESD or the Vendor be in any way personally liable or responsible for any covenant or agreement herein contained whether expressed or implied, nor for any statement or representation made herein or in any connection with this Agreement.

ARTICLE XI. TERMINATION

17.32. Termination for Default

1.1.28. The violation of any term or condition of this Agreement, or the failure to fulfill in a timely and proper manner any requirement in this Agreement by either party shall constitute a default of this Agreement.

1.1.29. Except as otherwise provided herein, in the event of a default by either party, the aggrieved party may terminate this Agreement without penalty or further liability, except as expressly provided herein, upon not less than 120 Calendar Days prior written notice to the defaulting party; Provided, that the defaulting party has failed to cure such default within that 120 day period, or such longer period, as may be reasonably determined by the aggrieved party, if the defaulting party is diligently working to cure the default. If the default is not cured within the cure period, the aggrieved party may immediately terminate this Agreement by giving written notice to the defaulting party. The option to terminate shall be at the sole discretion of the aggrieved party.

1.1.30. In the event of a Vendor default, ESD reserves the right to suspend all or part of

this Agreement, withhold further payments, or prohibit Vendor from incurring additional obligations of funds: (a) during the investigation of the alleged


Vendor default; (b) pending corrective action by Vendor of a default; or (c) pending a decision by ESD to terminate this Agreement.

1.1.31. In the event of termination of this Agreement by ESD for a Vendor default, ESD shall have the right to procure the Products and Services on the open market and Vendor shall be liable for all costs, expenses, and damages incurred by ESD for such default and termination, including but not limited to: (i) the cost difference between the original Agreement price for the Products and Services and the replacement costs of such Products and Services acquired from another vendor; (ii) all administrative costs directly related to the replacement of this Agreement, including but not limited to costs of competitive bidding, mailing, advertising, applicable fees, charges, or penalties, and ESD staff and consultant time costs; and (iii) any other costs to ESD resulting from Vendor’s default and the termination of this Agreement for such default. ESD shall have the right to deduct from any monies due to Vendor, or that thereafter become due, an amount for damages that Vendor will owe ESD for Vendor’s default.

1.1.32. In the event of termination of this Agreement by Vendor for an ESD default, ESD shall be liable only for payments required by the terms of this Agreement for Products received and accepted and for Services received by ESD prior to the effective date of termination.

1.1.33. Waiver or acceptance of any default of the terms of this Agreement by ESD shall not operate as a release of Vendor’s responsibility for any prior or subsequent default.

1.1.34. If Vendor defaults on any provision in this Agreement three (3) times within a six (6) month period, the third default shall be deemed “non-curable” and this Agreement may be terminated by ESD on not less than thirty (30) Calendar Days written notice.

17.33. Termination by ESD

1.1.35. ESD may terminate this Agreement in whole or in part, without penalty or further liability as follows:

1.1.35.1. In the event ESD’s authority to perform any of its duties is withdrawn, reduced, or limited in any way after the commencement of this Agreement and prior to normal completion, ESD may terminate this Agreement, in whole or in part, by seven (7) Calendar Day’s written notice to Vendor. This Section shall not be construed to permit ESD to terminate this Agreement in order to acquire similar Products or Services from a third party;

1.1.35.2. In the event funding to ESD is withdrawn, reduced or limited in any way after the effective date of this Agreement and prior to normal completion, ESD may terminate this Agreement by seven (7)


Calendar Days written notice to Vendor;

1.1.35.3. In the event funds are not allocated to ESD to continue this Agreement in any future period, ESD may at its option terminate this Agreement by seven (7) Calendar Days written notice to Vendor or work with Vendor to arrive at a mutually acceptable resolution of the situation. ESD agrees to notify Vendor in writing of such non-allocation at the earliest possible time. This Section shall not be construed to permit ESD to terminate this Agreement in order to acquire similar Products or Services from a third party;

1.1.35.4. In the event ESD determines, after due notice and examination, that Vendor has violated Chapter 42.52 RCW, Ethics in Public Service, or any other laws regarding ethics in public acquisitions and procurement and performance of contracts ESD may terminate this Agreement by written notice. In the event this Agreement is so terminated, ESD shall be entitled to pursue the same remedies against Vendor as it could pursue under the Termination for Default Section;

1.1.35.5. In the event a receiver is appointed to take possession of Vendor’s assets, Vendor makes a general assignment for the benefit of creditors, or Vendor becomes insolvent or takes or suffers action under the Bankruptcy Act, ESD may terminate this Agreement immediately by written notice;

1.1.35.6. In the event ESD determines that it is in the best interest of the State of Washington to terminate this Agreement, ESD may terminate this Agreement by thirty (30) Calendar Days written notice to the vendor: Provided, that in the event of an emergency, as determined by ESD, ESD may terminate this Agreement immediately.

1.1.36. If this Agreement is terminated pursuant to this Section 11.2, ESD is liable only for payments required by the terms of this Agreement for Products received and for which acceptance has been given, and for Services received by ESD prior to the effective date of termination.

17.34. Termination Procedure

1.1.37. In addition to the procedures set forth below, if ESD terminates this Agreement, Vendor shall follow any procedures ESD specifies in ESD’s Notice of Termination.

1.1.38. Upon termination of this Agreement, ESD, in addition to any other rights provided in this Agreement, may require Vendor to deliver to ESD any property or Products specifically produced or acquired for the performance of such part of this Agreement as has been terminated.

1.1.39. Unless otherwise provided herein, ESD shall pay to Vendor the agreed-upon


Price, if separately stated, for the Products or Services received and for which acceptance has been given by ESD; Provided that, in no event shall ESD pay to Vendor an amount greater than Vendor would have been entitled to if this Agreement had not been terminated. ESD may withhold from any amounts due Vendor such sum as ESD determines to be necessary to protect ESD from potential loss or liability.

17.35. Termination-related Obligations Antecedent to Date of Termination. Upon nearing the end of the final term of this Agreement, and without respect to either the cause or time of such termination, the Vendor shall take all reasonable and prudent measures to facilitate and ensure an orderly transition to the successor vendor prior to the expiration of this Agreement.

ARTICLE XII. FORCE MAJEURE

17.36. Neither party shall be liable to the other or deemed in default under this Agreement if and to the extent that such party’s performance of this Agreement is prevented by reason of force majeure and the affected party has complied with the provisions of this Section.

17.37. For the purposes of this Agreement, the term “force majeure” means an occurrence that is beyond the control of the party affected and could not have been avoided by exercising due care. Force majeure shall include acts of God, war, terrorism, riots, strikes, fire, floods, earthquakes, epidemics, or other similar occurrences.

17.38. If either party is delayed by force majeure, said party shall provide reasonable notice to the other party that there will be delay or non-delivery of reports or services. The notification shall provide evidence of the force majeure to the satisfaction of the other party. Such delay shall cease as soon as practicable and written notification of same shall be provided. The time of completion shall be extended for a period equal to the time that the results or effects of such delay prevented the delayed party from performing in accordance with this Agreement.

17.39. ESD reserves the right to suspend the Agreement and/or purchase Services from the best available source during the time of force majeure, and the Vendor shall have no recourse against ESD.

ARTICLE XIII. RECORDS AND AUDITS

17.40. Public Records.

Any documents and records that are prepared by Vendor, its agents, contractors, Subcontractors, or consultants and delivered to ESD may be determined to be public records under the Washington Public Records Act, Chapter 42.56 RCW, and as such may be subject to public disclosure. ESD recognizes that certain documents and records may contain proprietary information exempt from disclosure under Public Records Act, may constitute trade secrets as defined in RCW 19.108.010(4) and may include confidential information which is otherwise subject to protection from misappropriation or disclosure. Should such records become the subject of a request for public disclosure, the following


provisions shall apply:

1.1.40. ESD shall immediately notify Vendor of such request and the date by which it anticipates producing the requested records.

1.1.41. Vendor must then assert in writing to ESD any claim that such records contain proprietary or confidential information that it believes is exempt from disclosure under the Public Records Act or is subject to protection pursuant to Chapter 19.108 RCW or other State law so that ESD may consider such assertion in responding to the requestor.

1.1.42. If Vendor fails to make such assertion within eight (8) Calendar Days after the date ESD notifies Vendor of its intended response, ESD shall have the right to make such disclosure.

1.1.43. If Vendor makes a timely assertion that the requested records contain proprietary or confidential information or trade secrets, ESD will allow Vendor an additional ten (10) Calendar Days for Vendor to seek judicial protection of the records pursuant to RCW 42.56.540. Such an action shall be at Vendor’s expense. Should ESD elect to participate in any such action its own attorney’s fees will be ESD’s expense. If Vendor does not seek judicial protection of the records within ten (10) Calendar Days after notifying ESD of its belief that the records contain proprietary or confidential information or trade secrets, then ESD shall release the records to the requestor.

1.1.44. If prior to judicial consideration of a challenge by a requester, ESD in its sole discretion believes Vendor does not have a valid claim, it shall so notify Vendor no less than five (5) Calendar Days prior to the date ESD intends to make the disclosure to allow Vendor to take such action as it deems appropriate prior to disclosure. ESD will not make such a disclosure while an action to enjoin disclosure is pending under RCW 42.56.540.

1.1.45. If ESD denies a request for public records solely for reasons other than Vendor’s assertion of proprietary or confidential information contained in records, Vendor has no responsibility for payment of any attorneys’ fees or fines that may be imposed on ESD, nor for payment of ESD’s attorneys’ fees.

1.1.46. In the event Vendor believes that any documents or records subject to transmittal to or review by ESD under the terms of this Agreement contains proprietary, trade secret or other materials that are exempt or protected from disclosure pursuant to applicable Laws and Regulations, Vendor shall identify and clearly mark such information prior to such transmittal or review. The provisions of this Section 13.1 shall apply even though Vendor may fail to identify and clearly mark such information prior to transmittal or review.

17.41. Records Retention

1.1.47. The Vendor shall maintain all books, records, documents, data and other


evidence relating to this Agreement and performance of the Services described herein, including but not limited to accounting procedures and practices which sufficiently and properly reflect all direct and indirect costs of any nature expended in the performance of this Agreement. The Vendor shall retain such records for a period of six (6) years following the date of final payment. If any litigation, claim or audit is started before the expiration of the six (6) year period, the records shall be retained the longer of either one (1) year following the termination of said litigation, claim or audit, including all appeals or six (6) years from the date of final payment on this Agreement.

1.1.48. At no additional cost, these records, including materials generated under the Agreement, shall be subject at all reasonable times to inspection, review or audit by ESD, personnel duly authorized by ESD, the Office of the State Auditor, and Federal and State officials so authorized by law, regulation or agreement.

1.1.49. Vendor shall incorporate in its Subcontracts this Section’s records retention and review requirements.

17.42. Federal and State Audit

1.1.50. The Vendor shall permit representatives of ESD, an auditor selected by ESD, and/or of the Federal Government, the Auditor of the State or their authorized assistants to examine the records of the Vendor relating to the services rendered under this Agreement. If the Vendor has contracted with a Subcontractor(s), the Vendor shall require its Subcontractor(s) to provide similar access to the designated Federal and State officials or their representatives.

1.1.51. Any audits required by this section which do not necessitate the compilation of records in addition to those which are otherwise required by other sections of this Agreement may be conducted without notice. Any audits required by this section which require the compilation of records in addition to those which are otherwise required by this Agreement may be conducted upon ten (10) Calendar Days written notice from ESD to the Vendor. In either case, ESD must provide written notice to the Vendor as to the purpose and expected length of time for such audit.

17.43. Independent Auditing

The Vendor shall annually provide a copy of its Independent Service Auditor’s Report prepared in accordance with attestation standards established by the American Institute of Certified Public Accountants for services provided in a Banking Services capacity to the ESD Program Manager.

The vendor will provide the annual independent audit report within 30 Calendar Days of the anniversary date of this Agreement.


17.44. The provisions in this Article shall survive the expiration or termination of this Agreement.

ARTICLE XIV. GENERAL PROVISIONS

17.45. Recitals

The Recitals set forth in Article I herein are hereby incorporated into this Agreement

17.46. Exhibits and Attachments

All exhibits, attachments and other documents referenced in this Agreement are hereby incorporated into this Agreement

17.47. Timeliness

1.1.52. ESD and the Vendor agree to provide services, and exchange information in a timely manner to meet time-critical deadlines.

1.1.53. Time is of the essence for this Agreement.

17.48. AssignmentsVendor may not assign this Agreement without the prior written consent of the ESD Contract Administrator. Provided that, Vendor may assign its interests in this Agreement to a substitute entity in the event of a takeover, merger or acquisition of the Vendor provided: (a) the Vendor has given written notice of said takeover, merger, or acquisition to the ESD Contract Administrator not less than 120 Calendar Days prior to the effective date of such takeover, merger, or acquisition; (b) the substitute entity has executed an assumption of this Agreement in full; and (c) the Vendor provides the ESD Contract Administrator with a copy of the written assignment and assumption within fifteen (15) Calendar Days of their respective execution.

17.49. Independent Status

In the performance of this Agreement, the parties will be acting in their individual, corporate or governmental capacities and not as agents, employees, partners, joint ventures, or associates of one another. The parties intend that an independent contractor relationship will be created by this Agreement. The Vendor, the Vendor's employees, and subcontractors performing under this Agreement are not employees of ESD. The Vendor will not hold itself out as nor claim to be an officer or employee of ESD by reason hereof, nor will the Vendor make any claim of right, privilege or benefit which would accrue to such employee under law. Conduct and control of the work will be solely with the Vendor.

17.50. Entire AgreementThis Agreement which includes these Terms and Conditions, and all attachments, exhibits, addenda and amendments thereto constitutes the entire agreement between the Vendor and ESD and no other statements or representations, written or oral, shall be deemed a part thereof.


17.51. Modifications and AmendmentsNo modification, amendment, alteration, addition, or waiver of any section, or condition of this Agreement shall be effective or binding unless it is in writing and signed by the ESD Contract Administrator and the authorized Vendor representative. Only the ESD Contract Administrator shall have the express, implied, or apparent authority to alter, amend, modify, add, or waive any provision, benefit or obligation of this Agreement on behalf of ESD.

17.52. Waiver

Waiver of any breach of any term or condition of this Agreement shall not be deemed a waiver of any prior or subsequent breach. No term or condition of this Agreement shall be held to be waived, modified, or deleted except by a written instrument signed by the ESD Contract Administrator and the Vendor representative authorized to waive, modify, or delete such term or condition.

17.53. Severability

If any provision of this Agreement or the application of any such provision to any person or set of circumstances is determined to be invalid, unlawful, void or unenforceable to any extent, the remainder of this Agreement, and the application of such provision to persons or circumstances other than those as to which it is determined to be invalid, unlawful, void or unenforceable, are not impaired or otherwise affected and continue to be valid and enforceable to the fullest extent permitted by law. Any provision of the Agreement found to be prohibited by law shall be ineffective to the extent of such prohibition without invalidating the remainder of the Agreement.

17.54. Governing Law

This Agreement shall be governed in all respects by the law and statutes of the State of Washington, without reference to conflict of law principles. The venue of any action hereunder shall be in the Superior Court for Thurston County, Washington.

17.55. Order of Precedence

1.1.54. The headings used herein are inserted for convenience only and shall not control or affect the meaning or construction of any of the provisions.

1.1.55. If any provision of this Agreement shall be deemed by a court of competent jurisdiction to be in conflict with any statute or rule of law, such provisions shall be deemed modified to conform to said statute or rule of law. In the event of any inconsistency in this Agreement, the inconsistency shall be resolved in the following order of precedence:

1.1.55.1. The most recently adopted Agreement amendments.

1.1.55.2. The Agreement.


1.1.55.3. Exhibit A – Scope of Services

1.1.55.4. Exhibit B – Pricing Schedule

17.56. Attorney’s Fees and Costs

In the event of any controversy, claim, or dispute arising out of this Agreement, each party shall be solely responsible for the payment of its own legal expenses, including but not limited to, attorney’s fees and costs.


17.57. Counterparts and Authority to Bind

This Agreement is to be executed in counterparts or in duplicate originals. Each counterpart or each duplicate shall be deemed an original copy of the Agreement signed by each party, for all purposes.

In Witness Whereof the parties hereto, having read this Agreement in its entirety, including all exhibits and attachments hereto, do agree in each and every particular and certify as to having authorization to contract on behalf of the party represented.

APPROVED APPROVEDWashington State <Vendor>Employment Security Department

<Name> <Name><Title> <Title>

Date Date

APPROVED AS TO FORMState of WashingtonOffice of the Attorney General

<Name>Assistant Attorney General

Date


AGREEMENT EXHIBIT A – SCOPE OF SERVICES

To be completed from RFP response


AGREEMENT EXHIBIT B – SCHEDULE OF FEES

To be completed from RFP response
