ATTACHMENT B TERMS AND CONDITIONS.PDF

ATTACHMENT B
TERMS & CONDITIONS
1 Definition of Terms.
As used in this Solicitation and any resulting Contract, the terms listed below are defined as
follows:
1.1 “Attachment” means any item the Solicitation requires the Offeror to submit as part of the
Offer.
1.2 “Contract” means the combination of the Solicitation, including the Uniform and Special
Instructions to Offerors, the Uniform and Special Terms and Conditions, and the
Specifications and Statement or Scope of Work; the Offer and any Best and Final Offers;
and any Solicitation Amendments or Contract Amendments; and any terms applied by
law.
1.3 "Contract Amendment" means a written document signed by the Procurement Officer that
is issued for the purpose of making changes in the Contract.
1.4 “Contractor” means any person who has a Contract with the State.
1.5 “Days” means calendar days unless otherwise specified.
1.6 “Gratuity” means a payment, loan, subscription, advance, deposit of money, services, or
anything of more than nominal value, present or promised, unless consideration of
substantially equal or greater value is received.
1.7 “Person” means any corporation, business, individual, union, committee, club or other
organization or group of individuals.
1.8 “Materials” means all property, including equipment, supplies, printing, insurance and
leases of property but does not include land, a permanent interest in land or real property
or leasing space.
1.9 “Offer” means a response to a solicitation.
1.10 “Offeror” means a vendor or person who responds to a Solicitation.
1.11 “Procurement Officer” means the person, or his or her designee, duly authorized by the
State to enter into and administer Contracts and make written determinations with
respect to the Contract.
1.12 “Scope of Work” means those provisions of this solicitation which specify the work and/or
results to be achieved by the Contractor.
1.13 “SHALL, MUST” indicates a mandatory requirement. Failure to meet these mandatory
requirements may result in the rejection of a proposal as non-responsive.
1.14 “SHOULD” indicates something that is recommended but not mandatory. If the Offeror
fails to provide recommended information, the State may, at its sole option, ask the
Offeror to provide the information or evaluate the proposal without the information.
1.15 “State” means the State of Arizona and Department or Agency of the State that executes
the Contract.
1.16 “State Fiscal Year” means the period beginning with July 1 and ending June 30,
1.17 “Subcontract” means any Contract, express or implied, between the Contractor and
another party or between a subcontractor and another party delegating or assigning, in
whole or in part, the making or furnishing of any material or any service required for the
performance of the Contract.
2 Contract Interpretation
2.1 Arizona Law. The Arizona law applies to this Contract including, where applicable, the
Uniform Commercial Code as adopted by the State of Arizona and the Arizona
Procurement Code, Arizona Revised Statutes (A.R.S.) Title 41, Chapter 23, and its
implementing rules, Arizona Administrative Code (A.A.C.) Title 2, Chapter 7.
2.2 Implied Contract Terms. Each provision of law and any terms required by law to be in
this Contract are a part of this Contract as if fully stated in it.
2.3 Relationship of Parties. The Contractor under this Contract is an independent
Contractor. Neither party to this Contract shall be deemed to be the employee or agent
of the other party to the Contract.
2.4 Severability. The provisions of this Contract are severable. Any term or condition
deemed illegal or invalid shall not affect any other term or condition of the Contract.
2.5 No Parole Evidence. This Contract is intended by the parties as a final and complete
expression of their agreement. No course of prior dealings between the parties and no
usage of the trade shall supplement or explain any terms used in this document and no
other understanding either oral or in writing shall be binding.
2.6 No Waiver. Either party’s failure to insist on strict performance of any term or condition of
the Contract shall not be deemed a waiver of that term or condition even if the party
accepting or acquiescing in the nonconforming performance knows of the nature of the
performance and fails to object to it.
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3 Contract Administration and Operation.
3.1 Records. Under A.R.S. § 35-214 and § 35-215, the Contractor shall retain and shall
contractually require each subcontractor to retain all data and other “records” relating to
the acquisition and performance of the Contract for a period of five years after the
completion of the Contract. All records shall be subject to inspection and audit by the
State at reasonable times. Upon request, the Contractor shall produce a legible copy of
any or all such records.
3.2 Non-Discrimination. The Contractor shall comply with State Executive Order No. 2009-
09 and all other applicable Federal and State laws, rules and regulations, including the
Americans with Disabilities Act.
3.3 Audit. Pursuant to ARS § 35-214, at any time during the term of this Contract and five (5)
years thereafter, the Contractor’s or any subcontractor’s books and records shall be
subject to audit by the State and, where applicable, the Federal Government, to the
extent that the books and records relate to the performance of the Contract or
Subcontract.
3.4 Facilities Inspection and Materials Testing. The Contractor agrees to permit access to its
facilities, subcontractor facilities and the Contractor’s processes or services, at
reasonable times for inspection of the facilities or materials covered under this Contract.
The State shall also have the right to test, at its own cost, the materials to be supplied
under this Contract. Neither inspection of the Contractor’s facilities nor materials testing
shall constitute final acceptance of the materials or services. If the State determines non-
compliance of the materials, the Contractor shall be responsible for the payment of all
costs incurred by the State for testing and inspection.
3.5 Notices. Notices to the Contractor required by this Contract shall be made by the State
to the person indicated on the Offer and Acceptance form submitted by the Contractor
unless otherwise stated in the Contract. Notices to the State required by the Contract
shall be made by the Contractor to the Solicitation Contact Person indicated on the
Solicitation cover sheet, unless otherwise stated in the Contract. An authorized
Procurement Officer and an authorized Contractor representative may change their
respective person to whom notice shall be given by written notice to the other and an
amendment to the Contract shall not be necessary.
3.6 Advertising, Publishing and Promotion of Contract. The Contractor shall not use,
advertise or promote information for commercial benefit concerning this Contract without
the prior written approval of the Procurement Officer.
3.7 Federal Immigration and Nationality Act. The contractor shall comply with all federal,
state and local immigration laws and regulations relating to the immigration status of their
employees during the term of the contract. Further, the contractor shall flow down this
requirement to all subcontractors utilized during the term of the contract. The State shall
retain the right to perform random audits of contractor and subcontractor records or to
inspect papers of any employee thereof to ensure compliance. Should the State
determine that the contractor and/or any subcontractors be found noncompliant, the State
may pursue all remedies allowed by law, including, but not limited to: suspension of work,
termination of the contract for default and suspension and/or debarment of the contractor.
3.8 E-Verify Requirements. In accordance with A.R.S. § 41-4401, Contractor warrants
compliance with all Federal immigration laws and regulations relating to employees and
warrants its compliance with Section A.R.S. § 23-214, Subsection A.
3.9 Offshore Performance of Work Prohibited. Any services that are described in the
specifications or scope of work that directly serve the State of Arizona or its clients and
involve access to secure or sensitive data or personal client data shall be performed
within the defined territories of the United States. Unless specifically stated otherwise in
the specifications, this paragraph does not apply to indirect or 'overhead' services,
redundant back-up services or services that are incidental to the performance of the
contract. This provision applies to work performed by subcontractors at all tiers.
4 Costs and Payments
4.1 Payments. Payments shall comply with the requirements of A.R.S. Titles 35 and 41, Net
30 days. Upon receipt and acceptance of goods or services, the Contractor shall submit
a complete and accurate invoice for payment from the State within thirty (30) days.
4.2 Availability of Funds for the Next State fiscal year. Funds may not presently be available
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for performance under this Contract beyond the current state fiscal year. No legal liability
on the part of the State for any payment may arise under this Contract beyond the current
state fiscal year until funds are made available for performance of this Contract.
4.3 Availability of Funds for the current State fiscal year. Should the State Legislature enter
back into session and reduce the appropriations or for any reason and these goods or
services are not funded, the State may take any of the following actions:
4.3.1 Accept a decrease in price offered by the contractor;
4.3.2 Cancel the Contract; or
4.3.3 Cancel the contract and re-solicit the requirements.
5 Contract Changes
5.1 Amendments. This Contract is issued under the authority of the Procurement Officer who
signed this Contract. The Contract may be modified only through a Contract Amendment
within the scope of the Contract. Changes to the Contract, including the addition of work
or materials, the revision of payment terms, or the substitution of work or materials,
directed by a person who is not specifically authorized by the procurement officer in
writing or made unilaterally by the Contractor are violations of the Contract and of
applicable law. Such changes, including unauthorized written Contract Amendments
shall be void and without effect, and the Contractor shall not be entitled to any claim
under this Contract based on those changes.
5.2 Subcontracts. The Contractor shall not enter into any Subcontract under this Contract for
the performance of this contract without the advance written approval of the Procurement
Officer. The Contractor shall clearly list any proposed subcontractors and the
subcontractor’s proposed responsibilities. The Subcontract shall incorporate by
reference the terms and conditions of this Contract.
6) Risk and Liability
6.1. Risk of Loss: The Contractor shall bear all loss of conforming material covered under
this Contract until received by authorized personnel at the location designated in the
purchase order or Contract. Mere receipt does not constitute final acceptance. The risk
of loss for nonconforming materials shall remain with the Contractor regardless of receipt.
6.2 Indemnification
6.2.1 Contractor/Vendor Indemnification (Not Public Agency) The parties to this
contract agree that the State of Arizona, its’ departments, agencies, boards and
commissions shall be indemnified and held harmless by the contractor for the
vicarious liability of the State as a result of entering into this contract. However,
the parties further agree that the State of Arizona, its’ departments, agencies,
boards and commissions shall be responsible for its’ own negligence. Each party
to this contract is responsible for its’ own negligence.
6.2.2 Public Agency Language Only Each party (as 'indemnitor') agrees to indemnify,
defend, and hold harmless the other party (as 'indemnitee') from and against any
and all claims, losses, liability, costs, or expenses (including reasonable
attorney's fees) (hereinafter collectively referred to as 'claims') arising out of
bodily injury of any person (including death) or property damage but only to the
extent that such claims which result in vicarious/derivative liability to the
indemnitee, are caused by the act, omission, negligence, misconduct, or other
fault of the indemnitor, its’ officers, officials, agents, employees, or volunteers."
6.3 Force Majeure. Except for payment of sums due, neither party shall be liable to the other
nor deemed in default under this Contract if and to the extent that such party’s
performance of this Contract is prevented by reason of force majeure. The term “force
majeure” means an occurrence that is beyond the control of the party affected and occurs
without its fault or negligence. Without limiting the foregoing, force majeure includes acts
of God; acts of the public enemy; war; riots; strikes; mobilization; labor disputes; civil
disorders; fire; flood; lockouts; injunctions-intervention-acts; or failures or refusals to act
by government authority; and other similar occurrences beyond the control of the party
declaring force majeure which such party is unable to prevent by exercising reasonable
diligence.
7 State's Contractual Remedies
7.1 Right to Assurance. If the State in good faith has reason to believe that the Contractor does not
intend to, or is unable to perform or continue performing under this Contract, the Procurement
Officer may demand in writing that the Contractor give a written assurance of intent to perform.
Failure by the Contractor to provide written assurance within the number of Days specified in the
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demand may, at the State’s option, be the basis for terminating the Contract under the Uniform
Terms and Conditions or other rights and remedies available by law or provided by the contract.
7.2 Stop Work Order.
7.2.1 The State may, at any time, by written order to the Contractor, require the Contractor to
stop all or any part, of the work called for by this Contract for period(s) of days indicated
by the State after the order is delivered to the Contractor. The order shall be specifically
identified as a stop work order issued under this clause. Upon receipt of the order, the
Contractor shall immediately comply with its terms and take all reasonable steps to
minimize the incurrence of costs allocable to the work covered by the order during the
period of work stoppage.
7.2.2 If a stop work order issued under this clause is canceled or the period of the order or any
extension expires, the Contractor shall resume work. The Procurement Officer shall
make an equitable adjustment in the delivery schedule or Contract price, or both, and the
Contract shall be amended in writing accordingly.
7.3 Right of Offset. The State shall be entitled to offset against any sums due the Contractor, any
expenses or costs incurred by the State, or damages assessed by the State concerning the
Contractor’s non-conforming performance or failure to perform the Contract, including expenses,
costs and damages described in the Uniform Terms and Conditions.
8 Contract Termination
8.1 Conflict of Interest. The Contractor shall not undertake any work that represents a potential
conflict of interest, or which is not in the best interest of Grantor or the State without prior written
approval by Grantor. The Contractor shall fully and completely disclose any situation that may
present a conflict of interest. If the Contractor is now performing or elects to perform during the
term of this contract any services for any Grantor health plan, provider or Contractor or an entity
owning or controlling same, the Contractor shall disclose this relationship prior to accepting any
assignment involving such party.
Additionally, Cancellation for Conflict of Interest. Pursuant to A.R.S. § 38-511, the State may
cancel this Contract within three (3) years after Contract execution without penalty or further
obligation if any person significantly involved in initiating, negotiating, securing, drafting or
creating the Contract on behalf of the State is or becomes at any time while the Contract or an
extension of the Contract is in effect an employee of or a consultant to any other party to this
Contract with respect to the subject matter of the Contract. The cancellation shall be effective
when the Contractor receives written notice of the cancellation unless the notice specifies a later
time. If the Contractor is a political subdivision of the State, it may also cancel this Contract as
provided in A.R.S. § 38-511.
8.2 Gratuities. The State may, by written notice, terminate this Contract, in whole or in part, if the
State determines that employment or a Gratuity was offered or made by the Contractor or a
representative of the Contractor to any officer or employee of the State for the purpose of
influencing the outcome of the procurement or securing the Contract, an amendment to the
Contract, or favorable treatment concerning the Contract, including the making of any
determination or decision about contract performance. The State, in addition to any other rights
or remedies, shall be entitled to recover exemplary damages in the amount of three times the
value of the Gratuity offered by the Contractor.
8.3 Suspension or Debarment. The State may, by written notice to the Contractor, immediately
terminate this Contract if the State determines that the Contractor has been debarred, suspended
or otherwise lawfully prohibited from participating in any public procurement activity, including but
not limited to, being disapproved as a subcontractor of any public procurement unit or other
governmental body. Submittal of an offer or execution of a contract shall attest that the contractor
is not currently suspended or debarred. If the contractor becomes suspended or debarred, the
contractor shall immediately notify the State.
8.4 Termination for Convenience. The State reserves the right to terminate the Contract, in whole or
in part at any time, when in the best interests of the State without penalty or recourse. Upon
receipt of the written notice, the Contractor shall stop all work, as directed in the notice, notify all
subcontractors of the effective date of the termination and minimize all further costs to the State.
In the event of termination under this paragraph, all documents, data and reports prepared by the
Contractor under the Contract shall become the property of and be delivered to the State upon
demand. The Contractor shall be entitled to receive just and equitable compensation for work in
progress, work completed and materials accepted before the effective date of the termination.
The cost principles and procedures provided in A.A.C. R2-7-701 shall apply.
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8.5 Termination for Default.
8.5.1 In addition to the rights reserved in the contract, the State may terminate the Contract in
whole or in part due to the failure of the Contractor to comply with any term or condition
of the Contract, to acquire and maintain all required insurance policies, bonds, licenses
and permits, or to make satisfactory progress in performing the Contract. The
Procurement Officer shall provide written notice of the termination and the reasons for it
to the Contractor.
8.5.2 Upon termination under this paragraph, all goods, materials, documents, data and reports
prepared by the Contractor under the Contract shall become the property of and be
delivered to the State on demand.
8.5.3 The State may, upon termination of this Contract, procure, on terms and in the manner
that it deems appropriate, materials or services to replace those under this Contract. The
Contractor shall be liable to the State for any excess costs incurred by the State in
procuring materials or services in substitution for those due from the Contractor.
8.6 Continuation of Performance through Termination. The Contractor shall continue to perform, in
accordance with the requirements of the Contract, up to the date of termination, as directed in the
termination notice.
8.7 Contract Cancellation (Minimum 10 Day): The Procurement officer reserves the right to cancel
the whole or any part of this contract due to failure by the Contractor to carry out any material
obligation, term or condition of the contract. The Procurement officer shall issue written notice to
the Contractor for acting or failing to act as in any of the following
8.7.1. The Contractor provides material that does not meet the specifications of the contract;
8.7.2. The Contractor fails to adequately perform the services set forth in the specifications of
the contract;
8.7.3. The Contractor fails to complete the work required or furnish the materials required within
the time stipulated by the contract;
8.7.4. The Contractor fails to make progress in the performance of the contract and/or gives the
Procurement officer reason to believe that the Contractor will not or cannot perform to the
requirements of the contract;
8.7.5. Upon receipt of the written notice of concern, the Contractor shall have a minimum of ten
(10) days (Procurement officer may determine a longer period) to provide a satisfactory
response to the Procurement officer. Failure on the part of the Contractor to adequately
address all issues of concern may result in the Procurement officer resorting to any single
or combinations of the following remedies:
8.7.5.1. Cancel any contract;
8.7.5.2. Reserve all rights or claims to damage for breach of any covenant of the
contract;
8.7.5.3. Perform any test or analysis on materials for compliance with the
specifications of the contract. If the result of any test confirms a material
no-compliance with the specifications, any reasonable expense of testing
shall be borne by the Contractor;
8.7.5.4. In case of default, the Procurement officer reserves the right to purchase
materials, or to complete the required work in accordance with the
Arizona Procurement Code. The Procurement officer may recover
reasonable excess costs from the Contractor by;
8.7.5.4.1. Deduction from an unpaid balance;
8.7.5.4.2. Collection against the bid and/or performance bond; or
8.7.5.4.3. Any combination of the above or any other remedies as provided by law.
9. Contract Claims: All contract claims or controversies under this Contract shall be resolved
according to A.R.S. Title 41, Chapter 23, Article 9, and rules adopted thereunder.
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10. Contract Disputes: Contract disputes arising under A.R.S. § Title 36, Chapter 29 shall be
adjudicated in accordance with Grantor Rules.
11. Arbitration The parties to this Contract agree to resolve all disputes arising out of or relating to
this contract through arbitration, after exhausting applicable administrative review, to the extent
required by A.R.S. § 12-1518, except as may be required by other applicable statutes (Title 41).
12. Cooperation with other Contractors: Grantor may award other contracts for additional or related
work and the Contractor shall fully cooperate with such other contractors and Grantor employees
or designated agents, and carefully fit its own work to such other contractors' work. Contractor
shall not commit or permit any act which will interfere with the performance of work by any other
contractor or by Grantor employees. Grantor shall equitably enforce this section to all contractors
to prevent the imposition of unreasonable burdens on any contractor.
13. Confidentiality of Records and Disclosure of Confidential Information:
13.1. The Contractor shall not, without prior written approval from Grantor, either during or after
the performance of the services required by this contract, use, other than for such
performance, or disclose to any person other than Grantor personnel with a need to
know, any information, data, material, or exhibits created, developed, produced, or
otherwise obtained during the course of the work required by this contract. This
nondisclosure requirement shall also pertain to any information contained in reports,
documents, or other records furnished to the Contractor by Grantor.
13.2. The Contractor shall establish and maintain written policies procedures and controls,
approved by Grantor, governing access to, duplication of, and dissemination of all such
information for the purpose of assuring that no information contained in its records or
obtained from Grantor or others carrying out its functions under the contract, is used or
disclosed by it, its agents, officers or employees, except as required to efficiently perform
duties under the contract. Persons requesting such information shall be referred to
Grantor. The Contractor’s data safeguard program shall further conform to the data
confidentiality and security requirements of Grantor policy and procedures, and all-
relevant state and federal requirements, including HIPAA standards
.
13.3. The disclosure of information in summary, statistical, or other form that does not identify
particular individuals is permitted only with prior Grantor approval. The use or disclosure
of information concerning Members will be limited to purposes directly connected with the
scope of this contract.
13.4. The Contractor shall advise its employees, agents and subcontractors, if any, that they
are subject to these confidentiality requirements. A signed confidentiality statement
containing language approved by Grantor will be obtained from all employees, agents
and subcontractors, if any, and maintained in the individual’s personnel file with a copy
sent to Grantor upon request.
14. Fraud and Abuse:
14.1. It shall be the responsibility of the Contractor to report all cases of suspected fraud and
abuse by subcontractors, members or employees. The Contractor shall provide written
notification of all such incidents to the Procurement officer.
14.2 As stated in A.R.S. § 13-2310, incorporated herein by reference, any person who
knowingly obtains any benefit by means of false or fraudulent pretenses, representations,
promises or material omissions is guilty of a class 2 felony.
14.3. Contractors are required to research potential overpayments identified by a fraud and
abuse investigation or audit conducted by Grantor. After conducting a cost benefit
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analysis to determine if such action is warranted, the Contractor should attempt to
recover any overpayments identified due to erroneous, false or fraudulent billings.
15. Lobbying: No funds paid to the Contractor by Grantor, or interest earned thereon, shall be used
for the purpose of influencing or attempting to influence an officer or employee of any federal or
State agency, a member of the United States Congress or State Legislature, an officer or
employee of a member of the United States Congress or State Legislature in connection with
awarding of any federal or State contract, the making of any federal or State grant, the making of
any federal or State loan, the entering into of any cooperative agreement, and the extension,
continuation, renewal, amendment or modification of any federal or State contract, grant, loan, or
cooperative agreement. The Contractor shall disclose if any funds other than those paid to the
Contractor by Grantor have been used or will be used to influence the persons and entities
indicated above and will assist Grantor in making such disclosures to CMS.
16. No Guaranteed Quantities: Grantor does not guarantee the Contractor any minimum or maximum
quantity of services or goods to be provided under this contract.
17. Ownership of Information and Data:
17.1. Any data or information system, including all software, documentation and manuals,
developed by Contractor pursuant to this contract, shall be deemed to be owned by
Grantor. The federal government reserves a royalty-free, nonexclusive, and irrevocable
license to reproduce, publish, or otherwise use and to authorize others to use for federal
government purposes, such data or information system, software, documentation and
manuals. Proprietary software which is provided at established catalog or market prices
and sold or leased to the general public shall not be subject to the ownership or licensing
provisions of this section.
17.2. Data, information and reports collected or prepared by Contractor in the course of
performing its duties and obligations under this contract shall be deemed to be owned by
Grantor. The ownership provision is in consideration of Contractor's use of public funds
in collecting or preparing such data, information and reports. These items shall not be
used by Contractor for any independent project of Contractor or publicized by Contractor
without the prior written permission of the Procurement officer. Subject to applicable
state and federal laws and regulations, Grantor shall have full and complete rights to
reproduce, duplicate, disclose and otherwise use all such information. At the termination
of the contract, Contractor shall make available all such data to the Procurement officer
within thirty (30) days following termination of the contract or such longer period as
approved by the Procurement officer. For purposes of this subsection, the term "data"
shall not include member medical records.
17.3. Except as otherwise provided in this section, if any copyrightable or patentable material is
developed by Contractor in the course of performance of this contract, the federal
government, Grantor and the State of Arizona shall have a royalty-free, nonexclusive,
and irrevocable right to reproduce, publish, or otherwise use, and to authorize others to
use, the work for state or federal government purposes. Contractor shall additionally be
subject to the applicable provisions of 45 C.F.R. Part 74 and 45 C.F.R. Parts 6 and 8.
18. Records:
18.1. In addition to the requirements set forth in this contract under the Uniform Terms and
Conditions, all books and records shall be maintained to the extent and in such detail as
required by Grantor Rules and Policies. The Grantor records management guidelines are
located at: http://www.azGrantor.gov. Records shall include, but not be limited to,
financial statements, case files (both hard copy and stored data), and other records
specified by Grantor.
18.2. The Contractor shall make available at its office at all reasonable times during the term of
this contract and the period set forth in in this section, any of its records for inspection,
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audit or reproduction by any authorized representative of Grantor, State or Federal
government.
18.3. The Contractor shall preserve and make available all records for a period of five (5) years
from the date of final payment under this contract except as provided below:
18.3.1. If this contract is completely or partially terminated, the records relating to the work
terminated shall be preserved and made available for a period of five years from the date
of any such termination.
18.3.2. Records that relate to grievances, disputes, litigation or the settlement of claims arising
out of the performance of this contract, or costs and expenses of this contract to which
exception has been taken by Grantor, shall be retained by the Contractor for a period of
five years after the date of final disposition or resolution thereof.
18.3.3. Completed case files shall be scheduled for archive shipment to Grantor, as defined by
Grantor Policy and Procedures.
19. Responsibility for Payments Indemnification: The Contractor shall be responsible for issuing
payment for services performed by the Contractor's employees and will indemnify and save
Grantor harmless for all claims whatsoever growing out of the lawful demands of employees,
subcontractors, suppliers or any other third party incurred in the furtherance of the performance of
the contract. The Contractor shall, at Grantor' request, furnish satisfactory evidence that all
obligations of the nature hereinabove designated have been paid, discharged or waived.
20. Term of Contract and Option to Renew:
20.1 The initial term of this contract shall be for two (2) initial years with one (1) one-year
option to extend, not to exceed a total contracting period of five (3) years. The terms and
conditions of any such contract extension shall remain the same as the original contract,
as amended. All contract extensions shall be through contract amendment, and shall be
at the sole option of Grantor.
20.2. If the Contractor chooses not to renew this contract, the Contractor may be liable for
certain costs associated with the transition of its members to a different Contractor. If the
Contractor provides the Procurement officer written notice of its intent not to renew this
contract at least 180 days before its expiration, this liability for transition costs may be
waived by the Procurement officer.
21. Key Personnel
It is essential that the Grantee train and provide adequate, experienced personnel, capable of
and devoted to the successful accomplishment of projects that may be performed under this
Agreement. The Grantee must agree to assign experienced individuals to project positions.
A. The Grantee agrees that, once assigned to work on a project under this Agreement, key
personnel should not be removed or replaced without prior written notice to the Grantor.
B. If key personnel are not available for work on a specific project, for a continuous period
exceeding thirty (30) calendar days, or are expected to devote substantially less effort to the
work than initially anticipated, the Grantee shall immediately notify the Grantor Program
Administrator and shall, subject to the concurrence of the Grantor, replace such personnel
with personnel of substantially equal ability and qualifications.
C. The Grantee shall assign specific individuals to the key programmatic and fiscal positions and
other changes to key personnel must be reported on or before the effective date of such
change to the Grantor.
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22. Agreement Renewal: The Agreement shall not bind nor purport to bind the Grantor for any
contractual commitment in excess of the original Agreement period or amount. The Grantor shall
have the right, at its sole and unfettered discretion, whether or not to extend this Agreement. If
so, the parties must execute a written amendment or a new contract. Consideration for renewal
will also be based on results of program and fiscal monitoring.
23. Funding: The Grantee shall maintain funds received under the Opioid STR Grant in a separate
ledger account and shall not mix these funds with other sources:
23.1 Opioid STR funds shall not be utilized for services that can be supported through other
accessible sources of funding such as other federal discretionary and formula grant
funds, e.g. HHS (CDC, CMS, HRSA, and SAMHSA), DOJ (OJP/BJA) and non-federal
funds, 3rdparty insurance, and sliding scale self-pay among others.
23.2 Opioid STR funds for treatment and recovery support services shall only be utilized to
provide services to individuals with a primary diagnosis of an opioid use disorder or to
individuals with a demonstrated history of opioid overdose problems.
23.3 The Grantee shall manage funds according to applicable federal regulations for
administrative requirements, cost principles and audits:
http://www.samhsa.gov/grants/grants-management/notice-award-noa/standardterms-
conditions.
23.4 With prior written approval, the contractor is authorized to transfer up to a maximum of
10% of the total budget amount between line items. Transfers of funds are only allowed
between funded line items. Transfers exceeding 10% or to a non-funded line item shall
require an amendment.
23.5 All travel related expenditures will require itemized receipts and will not exceed the State
Allowable rates. The Grantee will comply with the State of Arizona Accounting Manual
at: https://gao.az.gov/publications/saam.
23.6 In compliance with 2 C.F.R. Part 200, Grants & Agreements §200.331, Requirements for
Pass Thru Entities, the information below is solely to comply with 2 C.F.R. Part 200 and
does not reflect the funding amount or period of performance of the contract. Please refer
to the contract & Cost Reimbursement Line Item Budget.
23.7 Construction costs are not allowed.
23. Fund Management: The Grantee must maintain funds received under this Agreement in separate
ledger accounts and cannot mix these funds with other sources. The Grantee must manage funds
according to applicable federal regulations for administrative requirements, cost principles and
audits.
The Grantee must maintain adequate business systems to comply with federal requirements. The
business systems that must be maintained are:
 Financial Management
 Procurement
 Personnel
 Property
 Travel
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TERMS & CONDITIONS
A system is adequate if it is: 1) written; 2) consistently followed - it applies in all similar circumstances;
and 3) consistently applied – it applies to all sources of funds. The Grantor reserves the right to review
all business systems policies.
24. DUNS/CCR: Each successful recipient who is awarded funding must provide the following
prior to an Agreement being executed: (a) Dun and Bradstreet Universal Numbering System
(DUNS) number for the fiscal agent; and (b) proof of current registration in the Central Contractor
Registration (CCR) database. Additionally, CCR registration must be maintained for the term of
the Agreement. The DUNS website is located at http://fedgov.dnb.com/webform. The CCR
registration information may be found at https://www.sam.gov/portal/public/SAM/.
25. FFATA Reporting Requirements: The Grantee is required to provide certain information pursuant
to the Federal Funding Accountability and Transparency Act of 2006 reporting requirements (Pub.
L. No. 109-282, as amended by Section 6205 (a) of Pub. L. No. 110-252) “FFATA”). FFATA
requires that certain information on federal awards (federal financial assistance and expenditures)
be made available to the public via a single, searchable website, which is
www.USASpending.gov.
26. Insurance Requirements
I. INDEMNIFICATION CLAUSE:
To the extent allowed by law, Grantee shall defend, indemnify, and hold harmless the State
of Arizona, and its departments, agencies, boards, commissions, universities, officers,
officials, agents, and employees (hereinafter referred to as “Indemnitee”) from and against
any and all claims, actions, liabilities, damages, losses, or expenses (including court costs,
attorneys’ fees, and costs of claim processing, investigation and litigation) (hereinafter
referred to as “Claims”) for bodily injury or personal injury (including death), or loss or
damage to tangible or intangible property caused, or alleged to be caused, in whole or in part,
by the negligent or willful acts or omissions of Grantee or any of its owners, officers, directors,
agents, employees or subcontractors. This indemnity includes any claim or amount arising
out of, or recovered under, the Workers’ Compensation Law or arising out of the failure of
such contractor to conform to any federal, state or local law, statute, ordinance, rule,
regulation or court decree. It is the specific intention of the parties that the Indemnitee shall,
in all instances, except for Claims arising solely from the negligent or willful acts or omissions
of the Indemnitee, be indemnified by Grantee from and against any and all claims. It is
agreed that Grantee will be responsible for primary loss investigation, defense and judgment
costs where this indemnification is applicable. In consideration of the award of this contract,
the Grantee agrees to waive all rights of subrogation against the State of Arizona, its officers,
officials, agents and employees for losses arising from the work performed by the Grantee for
the State of Arizona.
II. INSURANCE REQUIREMENTS:
Grantee and subcontractors shall procure and maintain until all of their obligations have been
discharged, including any warranty periods under this Contract, are satisfied, insurance
against claims for injury to persons or damage to property which may arise from or in
connection with the performance of the work hereunder by the Grantee, his agents,
representatives, employees or subcontractors.
The insurance requirements herein are minimum requirements for this Contract and in no
way limit the indemnity covenants contained in this Contract. The State of Arizona in no way
warrants that the minimum limits contained herein are sufficient to protect the Grantee from
liabilities that might arise out of the performance of the work under this contract by the
Grantee, its agents, representatives, employees or subcontractors, and Grantee is free to
purchase additional insurance.
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TERMS & CONDITIONS
A. MINIMUM SCOPE AND LIMITS OF INSURANCE: Grantee shall provide coverage with
limits of liability not less than those stated below.
1. Commercial General Liability – Occurrence Form
Policy shall include bodily injury, property damage, personal and advertising
injury and broad form contractual liability coverage.
 General Aggregate $2,000,000
 Products – Completed Operations Aggregate $1,000,000
 Personal and Advertising Injury $1,000,000
 Damage to Rented Premises $ 50,000
 Each Occurrence $1,000,000
a. The policy shall be endorsed (Blanket Endorsements are not
acceptable) to include the following additional insured language:
“The State of Arizona, and its departments, agencies, boards,
commissions, universities, officers, officials, agents, and
employees shall be named as additional insureds with respect
to liability arising out of the activities performed by or on behalf
of the Grantee.” Such additional insured shall be covered to the full
limits of liability purchased by the Grantee, even if those limits of
liability are in excess of those required by this Contract.
b. Policy shall contain a waiver of subrogation endorsement (Blanket
Endorsements are not acceptable) in favor of the State of Arizona,
and its departments, agencies, boards, commissions, universities,
officers, officials, agents, and employees for losses arising from work
performed by or on behalf of the Grantee.
2. Business Automobile Liability
Bodily Injury and Property Damage for any owned, hired, and/or non-owned
vehicles used in the performance of this Contract.
 Combined Single Limit (CSL) $1,000,000
a. The policy shall be endorsed (Blanket Endorsements are not
acceptable) to include the following additional insured language:
“The State of Arizona, and its departments, agencies, boards,
commissions, universities, officers, officials, agents, and
employees shall be named as additional insureds with respect
to liability arising out of the activities performed by or on behalf
of the Grantee, involving automobiles owned, leased, hired or
borrowed by the Grantee.” Such additional insured shall be
covered to the full limits of liability purchased by the Grantee, even if
those limits of liability are in excess of those required by this
Contract.
b. Policy shall contain a waiver of subrogation endorsement (Blanket
Endorsements are not acceptable) in favor of the “State of
Arizona, and its departments, agencies, boards, commissions,
universities, officers, officials, agents, and employees” for
losses arising from work performed by or on behalf of the Grantee.
c. Policy shall contain a severability of interest provision.
3. Worker's Compensation and Employers' Liability
 Workers' Compensation Statutory
 Employers' Liability
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TERMS & CONDITIONS
Each Accident $1,000,000
Disease – Each Employee $1,000,000
Disease – Policy Limit $1,000,000
a. Policy shall contain a waiver of subrogation endorsement (Blanket
Endorsements are not acceptable) in favor of the “State of
Arizona, and its departments, agencies, boards, commissions,
universities, officers, officials, agents, and employees” for
losses arising from work performed by or on behalf of the Grantee.
b. This requirement shall not apply to: Separately, EACH contractor or
subcontractor exempt under A.R.S. § 23-901, AND when such
contractor or subcontractor executes the appropriate waiver (Sole
Proprietor/Independent Contractor) form.
4. Professional Liability (Errors and Omissions Liability)
Each Claim $1,000,000
Annual Aggregate $2,000,000
a. In the event that the professional liability insurance required by this
Contract is written on a claims-made basis, Grantee warrants that
any retroactive date under the policy shall precede the effective date
of this Contract; and that either continuous coverage will be
maintained or an extended discovery period will be exercised for a
period of two (2) years beginning at the time work under this
Contract is completed.
b. The policy shall cover professional misconduct or negligent acts for
those positions defined in the Scope of Work of this contract.
B. ADDITIONAL INSURANCE REQUIREMENTS: The policies shall include, or be
endorsed (Blanket Endorsements are not acceptable) to include, the following
provisions:
1. The Grantee's policies shall stipulate that the insurance afforded the contractor
shall be primary insurance and that any insurance carried by the Department, and
its agents, officials, employees or the State of Arizona shall be excess and not
contributory insurance, as provided by A.R.S. § 41-621 (E).
2. Coverage provided by the Grantee shall not be limited to the liability assumed
under the indemnification provisions of this Contract.
C. NOTICE OF CANCELLATION: With the exception of (10) day notice of cancellation for
non-payment of premium, any changes material to compliance with this contract in the
insurance policies above shall require (30) days written notice to the State of Arizona.
Such notice shall be sent directly to the Governor’s Accounting Office, 1700 W.
Washington, Suite 500, Phoenix, AZ 85007 and shall be sent by certified mail, return
receipt requested.
D. ACCEPTABILITY OF INSURERS: Grantees insurance shall be placed with companies
licensed in the State of Arizona or hold approved non-admitted status on the Arizona
Department of Insurance List of Qualified Unauthorized Insurers. Insurers shall have an
“A.M. Best” rating of not less than A- VII. The State of Arizona in no way warrants that the
above-required minimum insurer rating is sufficient to protect the Grantee from potential
insurer insolvency.
E. VERIFICATION OF COVERAGE: Grantee shall furnish the State of Arizona with
certificates of insurance (ACORD form or equivalent approved by the State of Arizona) as
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ATTACHMENT B
TERMS & CONDITIONS
required by this Contract. The certificates for each insurance policy are to be signed by
an authorized representative.
All certificates and endorsements (Blanket Endorsements are not acceptable) are to
be received and approved by the State of Arizona before work commences. Each
insurance policy required by this Contract must be in effect at or prior to commencement
of work under this Contract and remain in effect for the duration of the project. Failure to
maintain the insurance policies as required by this Contract, or to provide evidence of
renewal, is a material breach of contract.
All certificates required by this Contract shall be sent directly to the Governor’s
Accounting Office, 1700 W. Washington, Suite 500, Phoenix, AZ 85007. The State of
Arizona project/contract number and project description shall be noted on the certificate
of insurance. The State of Arizona reserves the right to require complete copies of all
insurance policies required by this Contract at any time.
F. SUBCONTRACTORS: Grantees’ certificate(s) shall include all subcontractors as
insureds under its policies or Grantee shall furnish to the State of Arizona separate
certificates and endorsements for each subcontractor. All coverages for subcontractors
shall be subject to the minimum requirements identified above.
G. APPROVAL: Any modification or variation from the insurance requirements in this
Contract shall be made by the contracting agency in consultation with the Department of
Administration, Risk Management Division. Such action will not require a formal Contract
amendment, but may be made by administrative action.
H. EXCEPTIONS: In the event the Grantee or sub-contractor(s) is/are a public entity, then
the Insurance Requirements shall not apply. Such public entity shall provide a Certificate
of Self-Insurance.
GRANTEE ADDENDUM
Amended 2016
This Addendum is made part of this Contract between the Grantor and the Grantee.
Grantor and Grantee agree that the underlying Contract shall comply with the Administrative
Simplification requirements of the Health Insurance Portability and Accountability Act of 1996
("HIPAA"), as set forth in Title 45, Parts 160 and 164 of the Code of Federal Regulations (the
"C.F.R."), as amended. In the event of conflicting terms or conditions, this Addendum shall
supersede the underlying Contract.
1. DEFINITIONS
The following terms used in this Addendum shall have the same meaning as those terms in the
HIPAA rules set forth in Title 45, Parts 160 and 164 of the C.F.R.: Breach, Data Aggregation,
Designated Record Set, Disclosure, Health Care Operations, Individual, Minimum Necessary,
Notice of Privacy Practices, Protected Health Information, Required by Law, Secretary, Security
Incident, Subcontractor, Unsecured Protected Health Information, and Use.
2. OBLIGATIONS AND ACTIVITIES OF GRANTEE
Grantee agrees to:
2.1. Not use or disclose protected health information (“PHI”) other than as permitted or
required by this Addendum or as required by law;
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TERMS & CONDITIONS
2.2. Use appropriate safeguards, and comply with Subpart C of 45 C.F.R. Part 164 with
respect to electronic PHI, to prevent use or disclosure of protected health information
other than as provided for by this Addendum;
2.3. Report to Grantor any use or disclosure of PHI not provided for by this Addendum of
which it becomes aware, including breaches of unsecured protected health information
as required at 45 C.F.R. §164.410, and any security incident of which it becomes aware
in the following manner;
2.3.1. Reporting. Grantee shall report to Grantor any use or disclosure of PHI that is not
authorized by the Contract, by law, or in writing by Grantor. Grantee shall make
an initial report to the Grantor Privacy Official not more than twenty-four (24)
hours after Grantee learns of such unauthorized use or disclosure. The initial
report shall include all of the following information to the extent known to the
Grantee at the time of the initial report:
A. A description of the nature of the unauthorized use or disclosure,
including the number of individuals affected by the unauthorized use or
disclosure;
B. A description of the PHI used or disclosed;
C. The date(s) on which the unauthorized use or disclosure occurred;
D. The date(s) on which the unauthorized use or disclosure was discovered;
E. Identify the person(s) who used or disclosed the PHI in an unauthorized
manner;
F. Identify the person(s) who received PHI disclosed in an unauthorized
manner;
G. A description of actions, efforts, or plans undertaken by the Business
associate to mitigated the harm of the unauthorized disclosure;
H. A description of corrective actions undertaken or planned to prevent
future similar unauthorized use or disclosure;
I. An assessment of whether a breach, as defined in 45 C.F.R. 164.402,
including, if necessary, an assessment of the probability of harm, and
J. Such other information, as may be reasonably requested by the Grantor
Privacy Official.
Grantee shall provide Grantor with supplemental reports promptly as new
information becomes available, as assessments and action plans are developed,
and as action plans are implemented. In any event, Grantee shall provide a
comprehensive written report including all of the information listed above no later
than twenty (20) days after discovery of the unauthorized use or disclosure.
2.3.2. Mitigation. Grantee agrees to mitigate, to the extent practicable, any harmful
effect that is known to Grantee of a use or disclosure of PHI by Grantee in
violation of the requirements of the Contract.
2.3.3. Sanctions. Grantee shall have and apply appropriate sanctions against any
employee, subcontractor or agent who uses or discloses Grantor PHI in violation
of this Addendum or applicable law.
2.4. In accordance with 45 C.F.R. §164.502(e)(1)(ii) and §164.308(b)(2), if applicable, ensure
that any subcontractors that create, receive, maintain or transmit PHI on behalf of the
Grantee agree to the same restrictions, conditions and requirements that apply to the
Grantee with respect to such information;
2.5. Make available PHI in a designated record set to the Grantor necessary to satisfy
Grantor’s obligations under 45 C.F.R. §164.524;
2.6. Make any amendment(s) to PHI in a designated record set as directed or agreed to by
Grantor pursuant to 45 C.F.R. §164.526, or take other measures as necessary to satisfy
the Grantor’s obligations under 45 C.F.R.§164.526
2.7. Maintain and make available the information required to provide an Accounting of
Disclosures to Grantor as necessary to satisfy Grantor’s obligations under 45
C.F.R.§164.528
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TERMS & CONDITIONS
2.8. To the extent the Grantee is to carry out one of more of Grantor’s obligations under
Subpart E of 45 C.F.R. Part 164, comply with the requirements of Subpart E that apply to
Grantor in the performance of such obligation(s); and
2.9. Make its internal practices, books and records available to Grantor and the Secretary for
purposes of determining compliance with the HIPAA rules.
3. PERMITTED USES AND DISLOSURES BY GRANTEE
3.1. Grantee may only use or disclosure PHI as necessary to perform the services and
obligations set forth in the underlying Contract;
3.2. Grantee may use or disclose protected health information as required by law;
3.3. Grantee agrees to make uses and disclosures and requests for protected health
information consistent with Grantor’s Minimum Necessary Policy, located at
www.azGrantor.gov ;
3.4. Grantee may not use or disclose protected health information in a manner that would
violate Subpart E of 45 C.F.R. Part 164 if done by Grantor, except for the specific uses
and disclosures set forth below in (3.5 and 3.6);
3.5. Grantee may use protected health information for the proper management and
administration of the Grantee or to carry out the legal responsibilities of the Grantee; and
3.6. Grantee may provide data aggregation services relating to the health care operations of
Grantor.
4. PROVISIONS FOR Grantor TO INFORM GRANTEE OF PRIVACY PRACTICES AND
RESTRICTIONS
4.1. Grantor shall notify Grantee of any limitation(s) in the Grantor Notice of Privacy Practices
(found at www.azGrantor.gov) under 45 C.F.R. §164.520, to the extent that such
limitation may affect Grantee’s use or disclosure of PHI.
4.2. Grantor shall notify Grantee of any changes in, or revocation of, the permission by an
individual to use or disclose his or her PHI, to the extent that such changes may affect
Grantee’s use or disclosure of PHI and
4.3. Grantor shall notify Grantee of any restriction on the use or disclosure of PHI that Grantor
has agreed to or is required to abide by under 45 C.F.R. 164.522, to the extent
that such restriction may affect Grantee’s use or disclosure of PHI.
5. TERM AND TERMINATION
5.1. Term: This Addendum is effective upon the effective date of the underlying Contract and
shall terminate on the date Grantor terminates the contract for cause as authorized in
paragraph (b) of this Section, or for any other reason permitted under the contract,
whichever is sooner.
5.2. Termination for Cause: Grantee authorizes termination of the Contract by Grantor if
Grantor determines that Grantee has breached a material term of this Addendum and
Grantee has not cured the breach or ended the violation within the time specified by
Grantor.
5.3. Obligations of Grantee upon Termination: Upon termination, cancellation, expiration or
other conclusion of the Contract, Grantee, with respect to PHI received from Grantor, or
created, maintained, or received by Grantee on behalf of Grantor, shall:
5.3.1. Retain only that PHI which is necessary for Grantee to continue its proper management
and administration or to carry out its legal responsibilities;
5.3.2. Destroy or return to Grantor all remaining PHI that the Grantee still maintains in any form;
5.3.3. Continue to use appropriate safeguards and comply with Subpart C of 45 C.F.R. Part 164
with respect to electronic PHI to prevent use or disclosure of the PHI, other than as
provided for in this Section, for as long as Grantee retains the PHI;
5.3.4. Not use or disclose the PHI retained by Grantee other than for the purposes for which
such protected health information was retained and subject to the same conditions set
out in this Addendum that applied prior to termination; and
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ATTACHMENT B
TERMS & CONDITIONS
5.3.5. Destroy or return to Grantor the PHI retained by Grantee when it is no longer needed by
Grantee for its proper management and administration or to carry out its legal and
contractual responsibilities.
5.4. Survival: The obligations of Grantee under this Section shall survive the termination of
the Contract.
6. INDEMNIFICATION AND MISCELLANEOUS
6.1. Indemnification: Grantee shall indemnify, hold harmless and defend Grantor from and
against any and all claims, losses, liabilities, costs, civil and criminal penalties, and other
expenses resulting from, or relating to, the acts or omissions of Grantee, its employees,
agents, and sub-contractors in connection with the representations, duties and
obligations of the Grantee under this Addendum. The parties’ respective rights and
obligations under this Section shall survive termination of the Contract.
6.2. Regulatory References: A reference in this Addendum to a section in the HIPAA rules
means the section as in effect or as amended.
6.3. Amendment: The parties agree to take such action as is necessary to amend this
Addendum from time to time as is necessary for compliance with the requirements of the
HIPAA rules or any other applicable law.
6.4. Interpretation: Any ambiguity in this Addendum shall be interpreted to permit compliance
with the HIPAA rules.
7. FUNDING RESTRICTIONS
SAMHSA grant funds must be used for purposes supported by the program and may not be used
to:
 Pay for any lease beyond the project period.
 Provide services to incarcerated populations (defined as those persons in jail, prison,
detention facilities, or in custody where they are not free to move about in the community).
 Pay for the purchase or construction of any building or structure to house any part of the
program. (Applicants may request up to $75,000 for renovations and alterations of existing
facilities, if necessary and appropriate to the project.)
 Pay for housing other than residential mental health and/or substance abuse treatment.
 Provide residential or outpatient treatment services when the facility has not yet been
acquired, sited, approved, and met all requirements for human habitation and services
provision. (Expansion or enhancement of existing residential services is permissible.)
 Only allowable costs associated with the use of federal funds are permitted to fund evidence-
based practices (EBPs). Other sources of funds may be used for unallowable costs (e.g.,
meals, sporting events, entertainment). Other support is defined as funds or resources,
whether federal, non-federal or institutional, in direct support of activities through fellowships,
gifts, prizes, or in-kind contributions.
 Make direct payments to individuals to induce them to enter prevention or treatment services.
However, SAMHSA grant funds may be used for non-clinical support services (e.g., bus
tokens, child care) designed to improve access to and retention in prevention and treatment
programs.
Agreement No. IGA-STR-18-050118-01 Page 16 of 16