chair John Chiang
member Jerome E. Horton
member Ana J. Matosantos
Procurement and Asset Management
PO Box 2086
Rancho Cordova, CA 95741-2086
Telephone
916.845.3236
Fax
916.843.0496
January 25, 2012
TO:
Prospective Contractors
RE:
RFP Number C1100104 for Personal Income Tax Collections
Responses to Pre-Proposal Conference Questions
The questions below were submitted in response to Request for Proposal C1100104. The questions will be
answered in the order received. Questions received prior to the mandatory Pre-Proposal Conference that
cannot be answered prior to the conference will be posted to bidsync as soon as the answers are available.
In the case of any questions asked at the conference that cannot be answered immediately, FTB will email
the questions and answers to all Bidders who attended the conference.
1.
Is subcontracting with a small business, California business or Veteran Owned business preference or
is this to a mandatory requirement?
Subcontracting with a small business or a non small business claiming 25% California certified small business
subcontractor participation requires that a 5% preference be given to Contractor’s who qualify.
For the purpose of this solicitation, the Disabled Veteran Business Enterprise program requirements
have been waived
2.
Must the attachment list (Page #4) be attached to the proposal?
Yes.
3.
Can the PUC license, referenced on Page #82 be disregarded, since it pertains to only "Moving
services contracts"?
PUC license requirements do not apply for this procurement. Bidders should answer “Not Applicable”
on the form.
4.
Section B.2.4.14 requests certification of being in the collection business for five years. Can you
please clarify?
The Contractor is required to have been in the collection business for five years. Self Certification of
the dates the company has been in the collection business will be sufficient for this requirement.
5.
Is the FTB releasing a RFP due to the expiration of the current contract, poor vendor performance or
both? Please explain.
FTB is releasing this RFP due to the expiration of the current contract.
Pre-Proposal Questions
RFP Number C1100104
Page 2 of 25
6.
How would the FTB rank the following in the order of importance: Customer Service, Recoveries,
Price?
All three elements factor into the cost portion of the RFP and commission in potential subsequent
years of the Agreement. Total Target Recovery Rate and Price will determine whether the bidder will
provide the best value and net recovery to the State. Yearly Target Recovery Rate and Customer
Service will determine whether the Contractor receives a sliding scale commission increase in
potential subsequent years of the contract. The bidder must consider all three factors when
submitting the proposal.
7.
How many total agencies does the FTB currently use for services within the RFP?
FTB currently contracts with one agency.
8.
How many collection agencies do you plan to use?
As stated in B.5.3 of the RFP (page 77) FTB intends to select three Contractors for this workload.
9.
What was the average monthly liquidation recovery percentages for your current primary vendors in
2010 and 2011?
The recovery rate for the current Contractor for fiscal year 2010-2011 was 0.67%.
10.
What are the FTB liquidation expectations for 2012?
Each prospective Contractor should bid responsibly based on the debt profile provided in the RFP and
in full knowledge that FTB’s automated collection system has sent notices, searched for asset
information, and may have filed liens, and issued garnishments and/or levies prior to assignment,
and will continue to do so while accounts are assigned.
11.
Will the FTB allow a performance fee incentive for the awarded Contractors who excel and perform
beyond the FTB expectations?
The sliding scale compensation formula allows for an increase of commission in potential subsequent
years of the contract if the Contractor exceeds the target recovery rate entered on the cost proposal
worksheet for the previous contract year and meets the minimum performance requirements set out
in F.1.5 of the sample agreement (page 119)
12.
How many days is the tax files worked internally before the files are assigned to the collection
agency(s)?
As stated in B.5.4 of the RFP, FTB estimates that 97% of the accounts are expected to be aged 18
months or less. Age represents the time accounts have been in FTB’s Accounts Receivable Collection
System (ARCS).
Pre-Proposal Questions
RFP Number C1100104
Page 3 of 25
13.
How are the files worked by FTB prior to placement with the agency? Letters, phone calls, etc. If so
how many and when? Please explain your internal collection process prior to agency involvement.
FTB’s automated collection system will have sent notices, searched for asset information, and may
have filed liens, and issued garnishments and/or levies prior to assignment, and will continue to do
so while accounts are assigned.
14.
Will the FTB provide agencies with supporting documentation for each tax file? If so, will the
supporting docs be sent to the agencies in PDF format via email with the placements?
FTB will not provide supporting documentation for each tax file. Any questions from debtors regarding
the validity of the debt must be referred to FTB.
15.
To what extend does the FTB internal operations skip trace files before the files are assigned to
agency?
FTB’s automated collection system will have sent notices, searched for asset information, and may
have filed liens, and issued garnishments and/or levies prior to assignment, and will continue to do
so while accounts are assigned.
16.
17.
Section B.5.3 states that the FTB estimates 81,000 files to be assigned to each contracted agency.
Are these all primary placements?
Active debt on the accounts will be primary placements. FTB will not be referring secondary
placements, and bidders should not provide a bid for secondary placements.
Will the FTB allow the contracted vendor agency access to your internal data system? If so, what is the
cost and who pays?
Contractors will not have access to any FTB internal data system.
18.
RFP Section B.5.8: Percent of Accounts Withdrawn. What percentage of the accounts are withdrawn
after placement?
As stated in B.5.8, FTB estimates that half of the contacts a Contractor makes may result in
cancellation of some or all of the individuals’ liability. This includes accounts withdrawn for reasons
such as cancellation of tax, returns filed, FTB levies or garnishments, and Taxpayer Advocate referrals.
19.
Section B.5.7: Ongoing Automated Collections Does the FTB (ARCS) continue collection activity on
accounts already assigned to the agency?
FTB’s automated system continues to search for asset information, file liens, issue wage
garnishments and issue bank levies while accounts are assigned. However FTB collectors will not
manually attempt collections on accounts that are assigned to Contractors.
20.
What are the criteria used to determined if the collection recovery of such assigned accounts was
generated by ARCS or by the collection agency for compensation purposes?
The criteria will be located in B.1.5 of the Agreement (Compensation for Services), which will state:
Pre-Proposal Questions
RFP Number C1100104
Page 4 of 25
1. The Contractor will be compensated for services rendered on those accounts for which collections are
made in accordance with the terms of this Agreement.
2. The Contractor will not be compensated for any amounts collected in excess of the referred liability.
3. The Contractor will not be compensated for any amounts collected if it is determined that the debtor
resides outside the State of California.
4. The Contractor will not be compensated for any payments made directly to FTB which are determined to be
a direct result of FTB action. Payments considered to be a direct result of FTB action will include, but are
not limited to, the following:
a. Payment is made directly to FTB before the Contractor’s first contact with the debtor. The Contractor
will be notified of the payment, but the fee may not be authorized.
b. Balance due previously paid by the debtor. These amounts include, but are not limited to, withholding
credits and payments received before assignment to the Contractor, regardless of whether those
credits were applied to the debtor’s account prior to assignment.
c. Amounts paid as a result of withholding orders or other actions generated by FTB’s automated system.
d. Payment is made directly to FTB as the result of an escrow demand received by FTB prior the
Contractor’s first contact with the debtor. The Contractor will be notified of the payment, but the fee
may not be authorized.
e. Offsets from other federal, state, or government agencies.
f. For purposes of this section, in cases where person-to-person contact has not been made with the
debtor by the Contractor, first contact is defined as:
 An outgoing notice sent by the Contractor, provided there is no return mail on the address to which
the letter was sent; or
 A predictive dialer call or collector initiated call made by the Contractor or the Contractor’s system,
in which:
o A message is left for the debtor,
o The phone number called and the fact that a message was left for the debtor are documented
in the Contractor’s system; and
o Such documentation can be made available to FTB in a written transcript upon demand.
o Predictive dialer or collector-initiated calls in which only a busy signal is received are
considered incomplete calls and will not be considered first contact.
5. The Contractor will not be compensated for services rendered on accounts for which no collections are
made. Situations in which no collections made will include, but are not limited to, the following:
a. No tax, penalty, or interest liability exists.
b. A liability exists but the Contractor has not collected any of the amounts that are due.
c. The amount of the tax liability is not yet final, is in dispute, or is otherwise under appeal.
d. FTB cannot resolve a disputed account pursuant to Case Management, Disputed Accounts (Section
F.2.4).
21.
Section B.5.8: Percent of Accounts Withdrawn or Cancelled states that half of the contacts made by
Contractor may result in some of or all of the individual’s liability. Will the contractor be compensated
on the assigned accounts in which the individual is partially responsible for a less amount owed to the
FTB?
The Contractor will be compensated based on dollars collected that are determined to be the result of
the Contractor’s actions. If a debtor’s liability is reduced, and the Contractor collects all or a portion of
the reduced amount, the Contractor will be compensated. The Contractor will not receive
compensation for dollars abated, withdrawn or not collected.
Pre-Proposal Questions
RFP Number C1100104
Page 5 of 25
22.
Do you require the agency to credit report? If so, when?
FTB does not require or allow the Contractors to report delinquencies on FTB accounts to any credit
reporting agency.
23.
Does the FTB allow preauthorized settlements? If so, what is the preauthorized settlement authority?
FTB does not require or allow the Contractor to negotiate settlements for a delinquent debt, other
than a valid installment agreement for the full amount due.
24.
Will the FTB forward the direct payment file report to the agency on a daily, weekly or monthly basis?
FTB transmits the completed Direct Payment Analysis Report to Contractors weekly. In the event that
the report is delayed due to unforeseen circumstances, FTB will notify the Contractor as soon as the
issue is discovered and provide an estimated time to receive the report.
25.
What % of accounts assigned to your current agencies in 2009 and 2010 were your current agencies
not compensated for under the FTB guidelines listed in Section B.1.5 Compensation for Service 1-5?
Due to installment plans, FTB can receive multiple payments on any one account. The chart below
provides:
 The total number of accounts for each year for which FTB received at least one direct payment
 The total number of direct payments received by FTB for each year
 Of the direct payments received, the total number of payments that were authorized a
commission under B.1.5, Compensation for Services
26.
Year
Number of Accounts Receiving
Payments
Total Direct Payments
Received at FTB
Direct Payments Authorized A
Commission
2009
3,757
8,162
1,122
2010
4,657
10,478
1,970
2011
6,711
18,083
3,138
It appears that FTB wants a gross remit, please verify. If gross remittance is required; what is the net
payment terms to the agency?
As stated in B.1.3 of the proposed Agreement, FTB requires the Contractor to submit all monies
collected on behalf of FTB. Upon submission of a valid invoice pursuant to B.2.2 of the proposed
Agreement, FTB will review and validate the invoice and commissions to be paid. The invoice will be
submitted to and the commissions paid by the State Controller’s Office after validation and approval
of the invoice.
Pre-Proposal Questions
RFP Number C1100104
Page 6 of 25
27.
28.
What was the compensation amount remitted by the FTP to the current contracted vendors in 2010,
2011?
Year
Commissions Paid
2010
$ 410,925
2011
$ 394,564
What is the current contingency fee schedule for the existing vendor contractors? Is the current fee
schedule for your current contractors a flat rate fee or a tier fees schedule?
The current Contractor’s fee percentage is 18%. All fees are flat rate except for any potential sliding
scale compensation adjustment in subsequent years.
29.
While it is understood that no volume of work can be guaranteed, what is the average monthly
placement of debt with the incumbent vendor?


30.
We intend to award three contracts under RFP C1100104 with 3,000 accounts per month for
each contract.
In the event that we do not receive three responsive and responsible bids, we will divide the
9,000 total accounts to be assigned each month evenly among the remaining Contractors.

If subsequent years for the Agreement are not approved by FTB, the 9,000 total accounts to be
assigned each month will be divided evenly among the remaining Contractors for those years.

Because we currently have one contractor, that contractor receives 9,000 accounts per month.
What percentage of debt placed is the incumbent vendor currently collecting?
The recovery rate for the current Contractor for fiscal year 2010-2011 was 0.67%.
31.
How many agencies is the State of California planning on awarding this portfolio to?
As stated in B.5.3 of the RFP (page 77) FTB intends to select three Contractors for this workload.
32.
Does the State currently have a vendor(s) performing the services outlined in this RFP? If so, who?
FTB currently contracts with Linebarger Goggan Blair & Sampson, LLP under contract number
C0700050.
33.
What is the average age of accounts at placement (at time of award and/or on a going-forward basis),
by category?



Audit (A): average age 1-6 months
Failure to File
o Filing Enforcement (F): average age 1-6 months
o Self Employed (S): average age 1-6 months
Return (R): average age 7-12 months
Pre-Proposal Questions
RFP Number C1100104
Page 7 of 25
34.
What estimated or actual dollars were paid last year, last month, or last quarter to any incumbent(s)?
For Fiscal Year 2011-2012 to date, the current Contractor has received:
Month
35.
Commissions Paid
Month
Commissions Paid
July 2011
$ 35,201
October 2011
$ 31,858
August 2011
$ 36,125
November 2011
$ 33,877
September 2011
$ 42,295
December 2011
$ 25,655
What has been the historical rate of return or liquidation rate provided by any incumbent(s), and/or
what is anticipated or expected as a result of this procurement?
Historical statistics for previous in-state contracts are listed in the charts on the following page.
Current In-State Collection Contracts: 03.28.2008 – 03.27.2012
through 06.30.2011
Three PCAs
03.28.2008 – 03.27.2009
One PCA
03.28.2009 – Present
Accounts Referred
280,854
Amount Referred
$ 1,140,936,712
Dollars Collected
$ 5,504,607
Commissions Paid
$ 953,430
Past In-State Collection Contracts: 10.17.2005 – 10.16.2007
Three PCAs
Accounts Referred
163,415
Amount Referred
$425,034,311
Dollars Collected
$6,720,326
Commissions Paid
$419,282
Past In-State Collection Contracts: 09.01.2002 – 08.31.2005
Three PCAs
Accounts Referred
126,510
Amount Referred
$561,913,093
Dollars Collected
$5,061,356
Commissions Paid
$543,525
Each prospective Contractor should bid responsibly based on the debt profile provided in the RFP and in full
knowledge that FTB’s automated collection system has sent notices, searched for asset information, and may
have filed liens, and issued garnishments and/or levies prior to assignment, and will continue to do so while
accounts are assigned.
Pre-Proposal Questions
RFP Number C1100104
Page 8 of 25
36.
If applicable, will accounts held by any incumbent(s) or any backlog be moved to any new vendor(s) as
a one-time placement at contract start up?
The current Contractor’s accounts will not be placed with the new contractors as a part of this
Agreement.
37.
To what extent will the location of the vendor’s call center and/or corporate headquarters have a
bearing on any award(s)?
As stated in J.3.0 of the proposed Agreement, FTB has the right to enter the Contractor’s premises
during normal working hours to inspect, monitor or otherwise evaluate their work performance in
regard to FTB account referrals. As such, the Contractor will maintain all records on accounts referred
by FTB in a facility within the United States and will ensure that all personnel with access to FTB’s
accounts or data work at facilities located within the United States. The corporate headquarters must
also be in the United States.
38.
What are the current contingency rates?
The current Contractor’s fee percentage is 18%.
39.
What is the current collection rate or what are the gross collections associated with the 2010
placements?
The recovery rate for the current Contractor for fiscal year 2010-2011 was 0.67%. In fiscal year 20102011, the Contractor collected $2,453,280.
40.
Will the accounts be divided equally between the vendors?
 We intend to award three contracts under RFP C1100104 with 3,000 accounts per month for each
contract.
 In the event that we do not receive three responsive and responsible bids, we will divide the 9,000
total accounts to be assigned each month evenly among the remaining Contractors.

41.
If subsequent years for the Agreement are not approved by FTB, the 9,000 total accounts to be
assigned each month will be divided evenly among the remaining Contractors for those years.
Will account placements vary over the course of the contract in relation to the vendors' performance?
As stated in F.1.5 of the Proposed Agreement (page 119 of the RFP), FTB requires that the Contractor meet
minimum standards in regard to customer service and information technology responsiveness:



Failure to meet a minimum score of 25 for Customer Service during the Quarterly Performance Evaluation
will result in 250 accounts being withheld from each biweekly placement to the Contractor during the
following quarter.
Failure to meet a minimum score of 30 in IT Responsiveness during the Quarterly Performance Evaluation
will result in 250 accounts being withheld from each biweekly placement to the Contractor during the
following quarter.
The number of accounts to be withheld during the following quarter’s placements for failing to meet
minimum requirements will be cumulative.
Pre-Proposal Questions
RFP Number C1100104
Page 9 of 25
42.
What is the State’s anticipated assignment timelines (daily, weekly, quarterly, etc)?
Currently, FTB assigned accounts once per month.
43.
What is the current commission rate contracted with each agency?
The current Contractor’s fee percentage is 18%.
44.
If the contract is awarded to a different vendor than currently contracted, will you be recalling the
accounts previously listed to the current vendor and forwarding those accounts to the new vendor? If
yes, what is the overall volume of these accounts (number of accounts and total dollars) that you
anticipate would be referred for collections?
The current Contractor’s accounts will not be placed with the new Contractors as a part of this
Agreement.
45.
If yes, will these accounts be allowed to be bid at a different rate, since these are what the collection
industry calls ‘seconds’ and are not primary-placed accounts? If a current vendor is not awarded
under the new contract, then their outstanding accounts will be referred to a new vendor. It is
unknown what the volume of these accounts would be since it is not known which (if any) current
vendors will not receive new contract awards. Forwarded accounts would be allowed to be bid at a
secondary rate since they are not primary-placed accounts.
Active debt on the accounts will be primary placements. FTB will not be referring secondary
placements, and bidders should not provide a bid for secondary placements.
46.
What is the average balance of the accounts you will refer for collections?
FTB estimates the average balance of the accounts to be placed will be $2,300. This average balance
includes all assessment types, but can be broken down as follows (see Section B. 5.2 Overview of
Account Characteristics and Assessment Type on pages 76-77 of the RFP):



47.
Audit (A) = 6.8% with an average balance of $1,105
Failure to File
 Filing Enforcement (F) = 28% with an average balance of $2,190
 Self Employed (S) = 15% with an average balance of $4,310
Return (R) = 50% with an average balance of $1,858
What is the age of the oldest accounts you will refer for collections?
As stated in Section B. 5.4 Age of Accounts to Be Placed (page 77 of the RFP), FTB estimates that
97% of the accounts are expected to be aged 18 months or less. Age represents the time accounts
have been in FTB’s Accounts Receivable Collection System (ARCS).
A very limited number of accounts may have one or more tax years with debt that is aged more than
120 months. However, the majority of the debt to be assigned is expected to be aged 18 months or
Pre-Proposal Questions
RFP Number C1100104
Page 10 of 25
less. Age represents the time accounts have been in FTB’s Accounts Receivable Collection System
(ARCS).
48.
B.2.4: Past Performance and Experience (190 Points) - FTB will evaluate the Bidder’s past
performance and experience. To do this, FTB will evaluate each Bidder’s past performance based on
input from three current or former clients. FTB will provide the Past Performance Questionnaire shown
below to three primary references and three alternate references. If the primary reference does not
respond, the response from the alternate reference will be used.
To clarify, will the Bidder provide FTB with three primary and three alternate references in order for
FTB to send out the Past Performance Questionnaire to these references? Or should the Bidder send
the Questionnaire out to the three primary and three alternate references and request that the
references send the Questionnaire back to FTB?



As stated in Section B.2.4, each Bidder must include a list of five clients each in government tax debt,
government nontax debt, and consumer debt for which the Bidder is presently contracted to collect debt,
or has contracted to collect debt within the past five years.
FTB will choose the primary and alternate reference for each debt type from that list and will mail the
questionnaire.
No restrictions are placed on which clients the Bidder may provide for each type of debt. FTB will choose
which of each five clients to contact based on the similarity to the sensitivity of the type of debt and in
volume and value of the debt placed.
 If a Bidder has less than five clients in a particular category, the Bidder must:
o Provide all clients for the affected category
o Indicate that the Bidder has provided less than the required number of clients for that category
o The reason the Bidder does not have a sufficient number of clients in the category (for example,
the Bidder does not collect debt in a particular category)
Bidders should make every effort to ensure client information is correct and current.
49.
What are the top five (5) areas of improvement that the California Franchise Tax Board expects from
this new procurement based on the performance of the current Contractors?
FTB’s expectations under RFP C1100104 are identical to the expectations for all previous procurements for
collection services. We continue to expect:
 A commitment to providing all customers excellent service by collecting debts without harassment or
verbal abuse of the debtor, or compromising debtors’ rights




We expect all Contractors to provide services to the public in a manner that will preserve or enhance
goodwill between the public and the State of California
o FTB has zero tolerance for collection actions or activities that demonstrate anything less than
complete respect for the rights and reasonable expectations of the public (see Section E, Sample of
Proposed Agreement, Exhibit E, Customer Service and Complaints, page 114 et seq. of the RFP).
o Ensure the integrity and security of confidential data
We require all employees who may have contact with FTB’s confidential data (including
Information Technology and Fiscal staff) to complete FTB’s Disclosure Education Training (FTB
7611) annually and sign FTB Confidentiality Statement (FTB 7904) prior to working any FTB
workload
Increase fairness and compliance with the tax law
Demonstrate Operational Excellence
Pre-Proposal Questions
RFP Number C1100104
Page 11 of 25
50.
On what date did the current Personal Income Tax Collections contract become effective?
Contact Number C0700050 for the current Contractor was approved and effective March 28, 2008.
51.
What are the names of the current contractor(s)? Contingency fee rates, legal enforcement rates?
FTB currently contracts with Linebarger Goggan Blair & Sampson, LLP under contract number
C0700050. The current Contractor’s fee percentage is 18%. No litigation collections are required or
permitted under the current Agreement, or will be required or permitted under RFP C1100104.
52.
On what date did these current Contractors receive their first placements of accounts? What were the
total number of accounts and dollars placed for each Contractor on that date?
The first placement under RFP C0700050 was made on July 28, 2008 with the following volumes and
values:
53.
Contractor
Volume
Value
LGBS
2,246
$ 13,943,093
NCO
2,247
$ 13,531,414
UCB
2,246
$ 13,145,799
On what date did these current Contractors receive their second set of placements of accounts? What
were the total number of accounts and dollars placed for each Contractor on that date?
The second placement under RFP C0700050 was made on August 11, 2008 with the following
volumes and values:
54.
Contractor
Volume
Value
LGBS
2,309
$ 13,318,684
NCO
2,250
$ 12,386,094
UCB
2,248
$ 13,145,799
On what date did these current Contractors receive their third set of placements of accounts? What
were the total number of accounts and dollars placed for each Contractor on that date?
The third placement under RFP C0700050 was made on August 23, 2008 with the following volumes
and values:
Pre-Proposal Questions
RFP Number C1100104
Page 12 of 25
55.
Contractor
Volume
Value
LGBS
2,250
$ 11,569,144
NCO
2,251
$ 10,377,373
UCB
2,252
$ 11,311,997
On what date did these current Contractors receive their fourth set of placements of accounts? What
were the total number of accounts and dollars placed for each Contractor on that date?
The fourth placement under RFP C0700050 was made on September 6, 2008 with the following
volumes and values:
56.
Contractor
Volume
Value
LGBS
2,250
$ 7,941,569
NCO
2,250
$ 5,373,205
UCB
2,250
$ 7,836,744
On what date did these current Contractors receive their fifth set of placements of accounts? What
were the total number of accounts and dollars placed for each Contractor on that date?
The fifth placement under RFP C0700050 was made on September 28, 2008 with the following
volumes and values:
57.
Contractor
Volume
Value
LGBS
2,243
$ 5,436,632
NCO
2,245
$ 5,551,902
UCB
2,245
$ 6,219,670
On what date did these current Contractors receive their sixth set of placements of accounts? What
were the total number of accounts and dollars placed for each Contractor on that date?
The sixth placement under RFP C0700050 was made on October 4, 2008 with the following volumes
and values:
Pre-Proposal Questions
RFP Number C1100104
Page 13 of 25
Contractor
Volume*
Value
LGBS
1,500
$ 4,366,020
NCO
1,501
$ 5,151,108
UCB
1,502
$ 4,463,863
*Note: October placements in 2008 were semimonthly with half the accounts in each placement. The sixth placement of accounts only
includes half of the allotted monthly accounts.
58.
What is the total number of times that placements were sent to each Contractor over the term of the
current contract? What were the total number of accounts and dollars placed for each Contractor over
the term of the current contract?
The chart below shows the total number of placements under RFP C0700050 through December
2011 along with the following volumes and values:
Contractor
Placements
Volume
Value
LGBS
43
270,724
$ 1,111,179,909
NCO
16
27,735
$ 90,642,658
UCB
16
27,741
$ 93,826,672
*Note: Contracts for NCO and UCB ended March 27, 2009.
59.
How will the State assign the accounts to the Contractor? Via hard copy files? Via electronic
placements?
All files will be transferred to and from each Contractor via Secure Web internet File Transfer (SWIFT).
The requirements to ensure a secure file transfer are located in Section E, Sample of Proposed
Agreement, Exhibit I, Data Transfer and Resolution of System Issues, page 126 et seq. of the RFP).
60.
Please list the data fields for the information to be provided i.e. debtor name, address, telephone
number etc.
As stated in Exhibit E, Sample of Proposed Agreement, L.1.0 Record Layouts (page 135 of the RFP),
record layouts are proprietary and will not be provided until the Contractor signs the Agreement.
61.
Will the State also provide social security number information? If so, what percentage of the total
accounts has social security numbers?
FTB will provide the debtor’s account number and the associated social security number if a number
exists. In most cases the debtor’s account number is the social security number. In a very limited
number of cases, the account number may be an FTB taxpayer identification number or an IRS
Taxpayer Identification Number (ITIN).
Pre-Proposal Questions
RFP Number C1100104
Page 14 of 25
62.
Will the State also provide tax information number (TIN)? If so, what percentage of the total accounts
has TIN numbers?
FTB will provide the debtor’s account number and the associated social security number if a number
exists. In most cases the debtor’s account number is the social security number. In a very limited
number of cases, the account number may be an FTB taxpayer identification number or an IRS
Taxpayer Identification Number (ITIN).
63.
How many accounts/dollars were withdrawn back by the Franchise Tax Board by debt type over the
term of the current contract by each Contractor?
FTB is unable to estimate the dollar amount of the adjusted/withdrawn accounts. No administrative
fees or reduced commission rates will be paid for abatements, cancellations of tax, returns filed,
other administrative resolutions, or accounts recalled from the Contractor based on FTB collection
activity. These accounts will not be removed from the denominator when calculating the recovery rate
for purposes of the Performance Based Sliding Scale Compensation formula.
64.
Page 79 of the RFP states: B.5.4: Age of Accounts to Be Placed - FTB estimates that 97% of the
accounts are expected to be aged 18 months or less. Age represents the time accounts have been in
FTB’s Accounts Receivable Collection System (ARCS). On what date was ARCS implemented by the
FTB?
The Accounts Receivable Collection System was implemented in August, 2000.
65.
California’s Revenue & Taxation Code §19376 authorizes contractors (collection agencies) to refer
tax debt for litigation by its legal representatives in the name of the Franchise Tax Board and states
the following:
§19376. (a) For the purpose of collecting taxes, interest, additions to tax, and
penalties, the Franchise Tax Board may enter into agreement with one or more
private persons, companies, associations, or corporations providing debt
collection services outside this state with respect to the collection of taxes,
interest, additions to tax, and penalties. That agreement may provide, at the
discretion of the Franchise Tax Board, the rate of payment and the manner in
which compensation for services shall be paid. The compensation may be
added to the amount of the tax, interest, additions to tax, and penalties, and
collected as a part thereof, by the contractor from the tax debtor. The Franchise
Tax Board shall provide the necessary information for the contractor to fulfill its
obligation under this agreement.
(b) At the discretion of the Franchise Tax Board, the contractor may, as part of
the collection process, refer the tax debt for litigation by its legal
representatives in the name of the Franchise Tax Board.
Will the State allow a collection agency to subcontract with a law firm to reduce the outstanding
balance to a civil judgment? The collection activities would include:
 Pursue filing legal enforcement remedies to collect the debts
 File claims with the bankruptcy court
 Bank liens
 Personal property seizures
 Debtor examinations
 Garnishments
No litigation will be required or permitted under the Agreement.
Pre-Proposal Questions
RFP Number C1100104
Page 15 of 25
66.
Will the State allow the law firm to claim attorney fees in addition to the contingency fee to offset the
court filing fee costs, service of process fees/costs, and attorney time incurred with debtor exams,
preparing bank liens, bankruptcy court claim filings, garnishments and attending hearings, etc.
No litigation will be required or permitted under the Agreement.
67.
How many cases were approved for litigation under the current contract?
None. No litigation collections are required or permitted under the current Agreement.
68.
For years 2009, 2010, and 2011?
None. No litigation collections are required or permitted under the current Agreement.
69.
How many dollars were collected resulting from litigation under the current contract by year for 2009,
2010, and 2010?
None. No litigation collections are required or permitted under the current Agreement.
70.
How many bank levies were filed by year 2009, 2010, and 2011?
The question as written does not pertain to RFP C1100104. The information may be obtained through
a Public Records Act request.
71.
How many liens on real property were filed by year 2009, 2010, and 2011?
The question as written does not pertain to RFP C1100104. The information may be obtained through
a Public Records Act request.
72.
For accounts that have already been reduced to either an administrative or civil judgment will the
account information transmitted to the vendor under the new contract include:
 The court case number associated with these judgments
 A copy of the Judgment document
 Does the State have a website where these judgments can be searched on-line
 If not, can you provide the website address where these judgments can be searched on-line
Accounts to be assigned under RFP C1100104 will not be reduced to a civil judgment and no copy of
a judgment will be provided to the Contractors for any account assigned.
73.
Will accounts assigned under the contract be subject to the California Franchise Tax Board
Interagency Intercept Collections Program or the Federal Offset Programs? If so, are the collection
agencies credited for payments due to offsets?
Accounts assigned under the contract may be subject to the Interagency Intercept Collection Program
and/or the Federal Treasury Offset Program. As stated in B.1.5.4.e (page 103 of the RFP), Contractors
will not be compensated for any payments made directly to FTB which are determined to be a direct
Pre-Proposal Questions
RFP Number C1100104
Page 16 of 25
result of FTB action, including, but not limited to offsets from other federal, state, or government
agencies.
74.
How many days of advance notice will the FTB provide the Contractor once the FTB is notified by
either the Federal or State offset program that an offset has been successfully accessed?
Any account paid in full by an offset will be withdrawn when the balance is reduced to zero. Account
information is updated weekly. Any adjustment lowering the balance will be sent with the weekly
update.
75.
How many accounts/dollars have been assigned by the Agency to the Federal Treasury offset program
for years 2008, 2009, 2010, and 2011?
The question as written does not pertain to RFP C1100104.
76.
How many accounts/dollars were collected by the Federal Treasury offset program for years 2008,
2009, 2010, and 2011?
The question as written does not pertain to RFP C1100104.
77.
How many accounts/dollars have been returned as uncollectible to the Agency by the Federal
Treasury offset program for years 2008, 2009, 2010, and 2011?
The question as written does not pertain to RFP C1100104.
78.
How many accounts/dollars have been assigned by the Agency to the State offset program for years
2008, 2009, 2010, and 2011?
The question as written does not pertain to RFP C1100104.
79.
How many accounts/dollars were collected by the State offset program for years 2008, 2009, 2010,
and 2011?
The question as written does not pertain to RFP C1100104.
80.
How many accounts/dollars have been returned as uncollectible to the Agency by the Federal
Treasury offset program for years 2008, 2009, 2010, and 2011?
The question as written does not pertain to RFP C1100104.
81.
How long after the new contract begins will the State allow the prior vendor(s) to continue and collect
on accounts set-up on an installment plan?
As stated in Exhibit E, Sample of Proposed Agreement, A.2.2. Renewal Option (page 100 of the RFP),
the extension of time for any accounts the Contractor has in active installment agreements will end
90 days from the date the last payment is received from the last debtor in an active installment
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RFP Number C1100104
Page 17 of 25
agreement with the Contractor, or one year from the date the amendment is executed (March 27,
2013 for Contract Number C0700050), whichever is earlier in time.
82.
How soon after the new contract is awarded will the prior Contractor be required to return all accounts
not set up on any installment payment plan?
Contract Number C0700050 ends on March 27, 2012. All accounts not in a valid installment
agreement with the Contractor must be returned at that time.
83.
How many accounts/dollars assigned to the current Contractor are set-up on an installment plan?
Currently there are 917 accounts in active installment agreements with a value of $2.2 million.
84.
What is the minimum payment authorized under the installment plan?
As stated in Exhibit E, Sample of Proposed Agreement, G.2.2. Installment Agreements (page 121 of
the RFP) any installment agreement set by the Contractor must conform to FTB criteria (total balance
less than $10,000, total duration of installment agreement less than 36 months, with a payment
amount of at least $25 per month). If the debtor requests an installment agreement outside of these
criteria, the Contractor may not set the agreement without approval by FTB. FTB will not grant
approval without review of a completed and documented financial statement.
85.
What types of the accounts, to be assigned under the new contract, have been reduced to judgment?
Have the Judgments been recorded? Are the Judgments available and searchable via on-line via the
State website? What is the State’s website address that is searchable for these judgments? How
many accounts have been reduced to judgment status? What is the total dollar value for these
accounts?
Accounts to be assigned under RFP C1100104 will not be reduced to a civil judgment and no copy of
a judgment will be provided to the Contractors for any account assigned.
86.
What are the current contingency fee rates charged by the current vendors under contract? Is there a
guaranteed rate? If so what is the guaranteed rate provision? Have any of the vendors failed to meet
the guarantee? If so, what is the penalty? Has the penalty ever been imposed and paid?
The current Contractor’s fee percentage is 18%. The rate to be paid is submitted on the cost proposal
worksheet. The rate may be increased or decreased in potential subsequent years of the Agreement
using the sliding scale compensation formula illustrated in Exhibit E, Sample of Proposed Agreement,
B.1.6 Performance-Based Sliding Scale Compensation Formula (Pages 103-106 of the RFP).
87.
How many dollars were earned/paid to the current vendor(s) by years 2007, 2008, 2009, 2010, and
program to date 2011?
Current In-State Collection Contracts: 03.28.2008 – 03.27.2012
through 06.30.2011
Three PCAs
03.28.2008 – 03.27.2009
One PCA
03.28.2009 – Present
Accounts Referred
280,854
Amount Referred
$ 1,140,936,712
Dollars Collected
$ 5,504,607
Commissions Paid
$ 953,430
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RFP Number C1100104
Page 18 of 25
88.
Can you provide the locations of the current vendor(s) call centers used on this contract, the names of
the systems used to monitor/measure the minimum service levels listed above, how many audits
have been made of these call center requirements, copies of the audit reports, scheduled hours for
each location, a list of the non-English languages provided for each location, the total number of fulltime employees assigned at each location for this contract, and the total number of part-time
employees assigned at each location for this contract?
Staffing and system information for the current Contractor is proprietary to the Contractor and will not
be disclosed by FTB.
As stated in Exhibit E, Sample of Proposed Agreement, Exhibit F Quarterly Review, FTB evaluates each
Contractor quarterly. Part of the evaluation includes an account audit and an audit of random
accounts and phone recordings. To date thirteen Quarterly Performance Evaluations have been
completed. The scores are available on FTB’s public website at the following link:
https://www.ftb.ca.gov/individuals/pcap/quarterly_performance_evaluation.shtml
89.
Does the current vendor(s) provide any on-site employees at any of the Agency locations? If so the
street address for each location? The number of employees at each location? Scheduled hours by day
of the week at each location? List of the job duties at each location?
The current Contractor does not have an on-site employee at this time.
90.
Does the current vendor(s) direct all payments to the State?
No.
91.
Does the current vendor(s) collect all payments directly from the debtor, deduct their contingency fee
rate from each payment, and then remit the remaining monies to the court? Or does the vendor
forward all monies to the court then invoice the court?
As stated in Exhibit E, Sample of Proposed Agreement, B.2.0, Invoicing (page 106-108 of the RFP),
the Contractor remits weekly all monies collected on FTB’s behalf during the statement period to FTB
via Automated Clearing House deposit, even if the amounts collected exceed the correct balance due
on the account, along with the Weekly Payment Report detailing all payments remitted by the
Contractor and all direct payments authorized a fee on the weekly Direct Payment Analysis Report.
Upon submission of the monthly invoice, FTB will review the invoice and authorize payment to the
Contractor. Invoices are paid through the State Controller’s Office.
92.
Does the State add-on the contingency fee rate to each account PRIOR to assigning the account for
collection? OR does the vendor add-on the contingency fee rate after the account is assigned?
As stated in Exhibit E, Sample of Proposed Agreement, B.1.2, Collection Fees (page 102 of the RFP),
the Contractor will not add fees to the referred liability. Revenue and Taxation Code§19377 prohibits
the addition of the contractor’s fees to any liability assigned to contractor.
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RFP Number C1100104
Page 19 of 25
93.
Can you provide an estimate for the number of accounts and dollars that remain unpaid and will be
assigned for placement under the new contract and best estimate for the number of accounts and
dollars of new debts to be placed in the next 12 months for each of the types of accounts to be
assigned? Specifically for the following broken down by backlog and forward flow?
The current Contractor’s accounts will not be placed with the new contractors as a part of this
Agreement.
As stated in section B.5, Debt Profile (pages 76-77 of the RFP), the volume, value and types of accounts FTB
intends to place are as follows:
FTB estimates placing 81,000 accounts with each Contractor during the Agreement, in the following
increments:

Year 1 – 27,000 accounts, with an average value of $2,300 and a total value of $62,100,000
o 9 months of placements due to contract implementation
 Year 2 – 36,000 accounts, with an average value of $2,300 and a total value of $82,800,000
o Full year of placements
 Year 3 – 18,000 accounts, with an average value of $2,300 and a total value of $41,400,000
o 6 months of placements due to contract end
An “account” may consist of one or more tax years and one or more assessments within each tax year. Each
account will be identified by an alpha character “model type” which characterizes the nature of the account.
The model type is called the “assessment type” and will be one of the following:
 Audit (A) = 6.8% with an average balance of $1,105
 Failure to File
 Filing Enforcement (F) = 28% with an average balance of $2,190
 Self Employed (S) = 15% with an average balance of $4,310
 Return (R) = 50% with an average balance of $1,858
The assessment type is only an indicator. It is not guaranteed to accurately indicate either the type of account,
or collection potential. This is because the assessment type is determined at the time a collection account is
created. The nature of an account can change, but the assessment type as originally identified remains with
the account until it closes. For example, a collection account may be established as an “F” (failure to file)
assessment type. Although the subsequent filing of a return modifies the nature of the liability, the
assessment type will remain unchanged as an “F”.
94.
Is the State of California Franchise Tax Board in compliance with IRS Publication 1075 Exhibit 12
regarding approval to release FTI to collection agencies and their subcontractors?
FTB is currently in compliance and will submit the required request for approval when the contracts
are awarded and the Contractors known.
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RFP Number C1100104
Page 20 of 25
95.
How many accounts and dollars to be assigned under contract have been "discharged from
accountability pursuant to California's State Administrative Manual section 8776 ACCOUNTS
RECEIVABLE?
Accounts that have been discharged from liability will not be assigned under RFP C1100104.
96.
Are any of the accounts to be assigned under this contract subject to a statute of limitations? If so
what are the statute of limitations? 10 years? Renewable before 10 years? How many of the
accounts/dollars to be assigned are subject to less than 1 year of the statute running out? Within 2
years? Within 3 years?
Revenue and Taxation Code §19255 provides that a tax liability may generally not be collected upon
after twenty years have lapsed from the date the latest tax liability for a taxable year or the date any
other liability that is not associated with a taxable year becomes “due and payable” within the
meaning of Revenue and Taxation Code §19221, although the statute may be suspended in specific
situations such as time spent in bankruptcy or in an installment agreement. All liabilities to be
assigned are subject to the statute of limitations.
As stated in section B.5, Debt Profile (pages 76-77 of the RFP), FTB estimates that 97% of the
accounts to be placed are expected to be aged 18 months or less, and will therefore not be within 3
years of the statute expiring.
97.
How many of these accounts/dollars already have real property liens filed? Are in an administrative
judgment status? Have been filed with the Superior Court for a civil judgment?
As stated in section B.5, Debt Profile (pages 76-77 of the RFP), FTB estimates that 97% of the
accounts to be placed are expected to be aged 18 months or less. As such, they will be subject to the
statutory lien authorized by Revenue and Taxation Code § 19221.
Accounts to be assigned under RFP C1100104 will not be reduced to a civil judgment and no copy of
a judgment will be provided to the Contractors for any account assigned.
98.
Why doesn't the FTB implement the use of California Government Code 16580 "Accounts Receivable
Management Act" and use the ability to "add-on a contingency fee" to be paid by the debtor thus avoid
tax payer dollars and avoid any "pricing consideration" into the evaluation process?
Revenue and Taxation Code § 19377 specifically prohibits the addition of the contractor’s fees to any
liability assigned to contractor.
99.
Section D.9, Page 94 of 135/Attachment 9 – Can FTB please provide the form for Darfur Contract
Act?
The portable document format (PDF) of the Darfur Contracting Act can be accessed on page 94 of the
RFP. It can also be accessed below.
Darfur Contracting
Act
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RFP Number C1100104
Page 21 of 25
100. Proposal Certification, Page 82 of 135 – Can FTB please define what you are looking for in the space
designated as “Cal-T-”?
Cal-T requirements do not apply for this procurement. Bidders should answer “Not Applicable” on the
form.
101. It appears the current solicitation for collection services is very similar to what FTB issued back in
2007. Can FTB please identify any substantive changes that are being reflected in the current
solicitation?
As stated in A.5 Responsibility (page 9 of the RFP), the Bidder must take responsibility to:
 Carefully read the entire RFP.
 If clarification is necessary, ask the appropriate questions in a timely manner.
 Submit all required responses by the required dates and times.
 Ensure that all procedures and requirements of the RFP are accurately followed and appropriately
addressed.
 Carefully reread the entire RFP before submitting the proposal.
102. It appears FTB is utilizing the services of one collection vendor for the current contract. Is FTB
currently satisfied with the incumbent vendors’ performance or does FTB see areas that can be
improved upon? If so, can FTB please provide some specific items they would like to see improved
upon with this new solicitation?
As stated in Exhibit E, Sample of Proposed Agreement, Exhibit F Quarterly Review, FTB evaluates each
Contractor quarterly. Part of the evaluation includes an account audit and an audit of random
accounts and phone recordings. To date thirteen Quarterly Performance Evaluations have been
completed. The scores are available on FTB’s public website at the following link:
https://www.ftb.ca.gov/individuals/pcap/quarterly_performance_evaluation.shtml
FTB’s expectations under RFP C1100104 are identical to the expectations for all previous procurements for
collection services. We continue to expect:
 A commitment to providing all customers excellent service by collecting debts without harassment or
verbal abuse of the debtor, or compromising debtors’ rights

We expect all Contractors to provide services to the public in a manner that will preserve or enhance
goodwill between the public and the State of California
o FTB has zero tolerance for collection actions or activities that demonstrate anything less than
complete respect for the rights and reasonable expectations of the public (see Section E, Sample of
Proposed Agreement, Exhibit E, Customer Service and Complaints, page 114 et seq. of the RFP).
o Ensure the integrity and security of confidential data

We require all employees who may have contact with FTB’s confidential data (including
Information Technology and Fiscal staff) to complete FTB’s Disclosure Education Training (FTB
7611) annually and sign FTB Confidentiality Statement (FTB 7904) prior to working any FTB
workload
Increase fairness and compliance with the tax law
Demonstrate Operational Excellence


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RFP Number C1100104
Page 22 of 25
103. It is our understanding that with FTB’s prior solicitation for personal income tax collections issued in
2007 there were three collection service vendors selected for the project and that two of these
vendors were not retained for the full length of the project. Can FTB please provide a brief
explanation if something material occurred with the two service providers that were not retained for
the entire contract period(s)?
This question does not pertain to RFP C1100104. As stated in Exhibit E, Sample of Proposed
Agreement, Exhibit F Quarterly Review, FTB evaluates each Contractor quarterly. The scorecards for
the two evaluations of the two Contractors that did not renew are available at the following link:
https://www.ftb.ca.gov/individuals/pcap/Archive_Quarterly_Performance_Evaluation.shtml
104. Can FTB please provides details as to the current collection vendor's recovery rate performance as
compared to their target recovery rate estimates for year 1, year 2, and year 3 as provided in their
2007 RFP response? Can FTB provide the sliding scale for the entirely of the past contract?
Contractor
Contract Year 1
Contract Year 2
Contract Year 3
LGBS
Target Rate 4.51%
Actual Rate 0.48%
Target Rate 6.50%
Actual Rate 0.61%
Target Rate 7.23%
Actual Rate 0.52%
NCO
Target Rate 3.4%
Actual Rate 0.31%
Target Rate 3.5%
Did Not Renew
Target Rate 3.6%
Did Not Renew
UCB
Target Rate 1.97%
Actual Rate 0.34%
Target Rate 3.48%
Did Not Renew
Target Rate 8.85%
Did Not Renew
Bidders provided the target recovery amounts for the previous RFP in 2007, prior to the economic
collapse, and were based on the economy at that time. The current Contractor substantiated that the
decline in the economy beginning in 2008 could reasonably be demonstrated have caused the
Contractor’s inability to collect the target recovery amount in each contract year. Therefore, as
provided in B.1.6.10 of the Agreement C0700050, the current Contractor has received the Base
Commission Rate for the each subsequent year of Agreement.
105. Has the incumbent vendor's fees ever been adjusted, up or down, based on FTB's sliding scale compensation
formula? If so, please provide details as to what the fees were before and after the change.
Bidders provided the target recovery amounts for the previous RFP in 2007, prior to the economic collapse,
and were based on the economy at that time. The current Contractor substantiated that the decline in the
economy beginning in 2008 could reasonably be demonstrated have caused the Contractor’s inability to
collect the target recovery amount in each contract year. Therefore, as provided in B.1.6.10 of the Agreement
C0700050, the current Contractor has received the Base Commission Rate for the each subsequent year of
Agreement.
106. In Section B.2.4.14 (pg 44), can FTB please expand on their definition of consumer debt? Would consumer
debt be specific to non-government debt or would a certain kind of government debt be considered consumer
debt?
For the purposes of RFP C1100104, Section B.2.4.14, FTB considers consumer debt to be debt owed to a non
government entity.
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RFP Number C1100104
Page 23 of 25
107. Are we allowed to include indirect expenses (e.g. office supplies) as well as direct effort subcontracting (e.g.
printing) in our evaluation of total subcontracting towards the 25% target?

As stated in Section D.1, Attachment 1 under definitions page 84 of the RFP, a 5% bid preference is
available to a non-small business claiming 25% California certified small business subcontractor
participation.

California certified small businesses must perform a “commercially useful function” in the performance of
the contract as defined in Government Code § 14837 (d)(4).

As stated in Exhibit E, Sample of Proposed Agreement, J.4.0 Subcontracting, Contractors are prohibited
from subcontracting any of FTB’s collection accounts to any other organization, association, individual,
corporation, partnership, or group of individuals or other such entity without the prior written consent of
FTB. For purposes of this requirement, “subcontracting of any of FTB’s collection accounts” includes
subcontracting to any person or entity that may have any access to FTB data, including, but not limited to
the printing of notices.
108. The on-site employee is billed as “at FTB’s discretion.” Historically, has this role been required? If so, what has
the workload been? Who provides desktop/laptop computer for employee? If employee has time that is not
devoted to FTB contract, can he/she be utilized for other tasks/contracts? Will the employee be provided
network connectivity to access home network for general purpose access and/or other assignments?





Under RFP C0700050, the on-site liaison was required.
The on-site liaisons are the Contractors’ employees. As stated in Exhibit E, Sample of Proposed
Agreement, E.3.1 On-Site Liaison, the primary workload of the of the on-site liaison is to facilitate
the swift resolution of disputes and to minimize paper flow between FTB and the Contractor.
Any workload in addition to the above would be at the Contractor’s discretion as long as it relates
to this Agreement (e.g., collecting FTB accounts). The liaison may not work collection accounts
from the Contractor’s other clients due to the potential to comingle data.
Each liaison would have a designated cubicle on-site at the FTB Central Office Campus and would
go through the same security and disclosure training, background check and fingerprinting as FTB
employees, including receiving a badge for building access.
If requiring an on-site liaison becomes necessary, each Contractor must provide the liaison with
phone, phone-line, and a system terminal connected by automated means to the Contractor’s
processing system, at the Contractor’s expense.
109. Does the data partitioning requirement require physical partitioning/segregation or is logical
partitioning/segregation sufficient?
A separate instance on a database will be sufficient as long as FTB data is kept in separate database files
from other data, such that the data resides in separate files and cannot be commingled with non-FTB data.
110. Is a copy of the Security Questionnaire referenced in Exhibit D.1.0.6 available for review during the bid
process?
Information regarding the Security Questionnaire will be available during the Question and Answer session at
the mandatory Pre-Proposal Conference.
111. Exhibit D.1.0.6: What is the deadline for destruction of data?
As stated in Exhibit E, Sample of Proposed Agreement, Exhibit D.1.0.8 (page 111 of the RFP), all records
received by the Contractor from FTB and any database created, copies made, or files attributed to the records
received must be destroyed upon completion of the business purpose for which they were obtained.
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RFP Number C1100104
Page 24 of 25
112. B.1.4 Payments received by FTB will be provided to Contractor via Direct Payment Analysis Report (DPAR) –
Will this be the only method direct payments will be to the Contractor and can they be reported via file
transmission?
The amounts of all payments received at FTB on assigned accounts will be transmitted during each weekly
account update in order to ensure that the balance on the Contractor’s system is as current as is reasonably
possible.

Because FTB’s automated collection system continues to collect while accounts are assigned, not all
payments received by FTB will be generated by the Contractor’s actions.

The Direct Payment Analysis Report advises the Contractor of which payments received at FTB during the
previous week are generated by the Contractor’s actions and are authorized to receive a commission.
Payments must meet the criteria set out in Exhibit E, Sample of Proposed Agreement, B.1.5 Compensation
for Services in order to be authorized a commission.

113. B.1.3.4 – does the mean we are able to hold payments until we know the funds are good?
Yes. As stated in Exhibit E, Sample of Proposed Agreement, Exhibit B.1.3.5 (page 102 of the RFP), FTB will not
be responsible for personal checks that are returned to the Contractor because a financial institution did not
honor them or credit card payments whose charges are later reversed by the debtor. Any attempt by the
Contractor to collect such a debt must be subject to the same terms as any FTB collection account under this
Agreement.
114. In reference to Exhibit B.1.4: Payments Received by FTB, “Payments received by FTB will be provided to
Contractor via Direct Payment Analysis Report (DPAR)” – Will this be the only method direct payments will be
made to the Contractor and can they be reported via file transmission?



Because FTB’s automated collection system continues to collect while accounts are assigned, not all
payments received by FTB will be generated by the Contractor’s actions.
The Direct Payment Analysis Report advises the Contractor of which payments received at FTB during the
previous week are generated by the Contractor’s actions and are authorized to receive a commission.
Payments must meet the criteria set out in Exhibit E, Sample of Proposed Agreement, B.1.5 Compensation
for Services in order to be authorized a commission.
115. In reference to Exhibit B.1.3: Payments to Contractor, Is the Contractor able to hold funds from payments until
they have cleared the debtor’s bank account?
Yes. As stated in Exhibit E, Sample of Proposed Agreement, Exhibit B.1.3.5 (page 102 of the RFP), FTB will not
be responsible for personal checks that are returned to the Contractor because a financial institution did not
honor them or credit card payments whose charges are later reversed by the debtor. Any attempt by the
Contractor to collect such a debt must be subject to the same terms as any FTB collection account under this
Agreement.
116. Page 108 #8 Can FTB give an example of what is considered a misapplied collection?
One example of a misapplied collection, as mentioned in Exhibit E, Sample of Proposed Agreement, B.1.3.8
(page 102 of the RFP) would be that a Contractor transmits a payment to FTB collected from a debtor whose
account was assigned to the Contractor under an incorrect account number, resulting in a refund to an
incorrect debtor. If FTB is unable to recover the funds from the incorrect debtor, the Contractor would be
responsible for reimbursing FTB for the misapplied funds so that FTB can apply the money to the correct
debtor’s account.
Pre-Proposal Questions
RFP Number C1100104
Page 25 of 25
117. Page 104 #9 FTB has given guidance that the oldest debt is paid first. What if the debtor is giving us a
different preference due to the debtor’s specific situation?
If a debtor specifically designates a tax year on the payment or payment coupon, the Contractor may designate
the year requested when the payment is transmitted. If no year or liability is designated by the debtor, the
payment must be applied to the oldest year first.