HomeMy WebLinkAboutPR 19139: NURSE FAMILY PARTNERSHIP PROGRAM GRANT AWARD City of
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Texas
DATE: September 2, 2015
To: Brian McDougal, City Manager
From: Judith A. Smith,RN, BSN
RE: Authorization to enter into an Inter-Local Agreement Between the Health and
Human Services Commission and the City of Port Arthur for The Nurse-Family
Partnership Program Grant Award for FY 2015-2016
Nature of the Request: The State of Texas, by and through the Texas Health and Human
Services Commission (HHSC) approved a grant proposal to the City of Port Arthur to support
the establishment and operation of local Nurse-Family Partnership (NFP) program to provide
educational, health, guidance, and other resources for low-income, Medicaid eligible, first-time
pregnant women during pregnancy, and during the first two years of their infant's life through
visits by highly trained registered nurses.
Analysis, Considerations: The contract period starts 09/01/2015 and ends 08/31/2016 and
requires a 10% cash match of$58,063.00. This grant covers salaries, fringe, travel, and supplies
for 6 employees.
Recommendations: It is recommended that the City Council approve P.R. No. 19139 the FY
2016 contract between the City of Port Arthur and Texas Health and Human Services
Commission.
Budget Considerations: Total payments received from this contract will be $580,633.00.
"REMEMBER WE ARE HERE TO SERVE THE CITIZENS OF PORT ARTHUR"
P.O.BOX 1089•PORT ARTHUR,TX 77641-1089.409/983-8101•FAX 409/982-6743
P.R. No. 19139
09/02/2015-js
RESOLUTION NO.
A RESOLUTION AUTHORIZING THE EXECUTION OF AN
INTERLOCAL AGREEMENT BETWEEN THE HEALTH AND
HUMAN SERVICES COMMISSION AND THE CITY OF PORT
ARTHUR FOR THE NURSE FAMILY PARTNERSHIP PROGRAM
GRANT AWARD FOR FY 2015-2016 IN THE AMOUNT OF
$580,633.00
WHEREAS, the State of Texas, by and through the Texas Health and Human
Services Commission (HHSC) awarded grant funds to eligible entities to support the
establishment and operation of local Nurse-Family Partnership (NFP) programs to
provide educational, health, guidance, and other resources for low-income, first-time
pregnant women during pregnancy, and during the first two years of their infant's life
through visits by highly trained registered nurses; and,
WHEREAS, this Amendment provides for six (5) full-time registered nurses, one
(1) full-time clerical support person, and will allow for a caseload of 100 families; and,
WHEREAS, HHSC will award grant funds for approximately 90% of the total
annual base budget for the Nurse-Family Partnership grant and the City is expected to
contribute the remaining 10% from local match funds.
NOW THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF
THE CITY OF PORT ARTHUR:
Section 1. That, the facts and opinions in the preamble are true and correct.
Section 2. That, the City Council of the City of Port Arthur hereby authorizes
the Interlocal Agreement between the Health and Human Services Commission and the
City of Port Arthur for the Nurse-Family Partnership Program grant award in the amount
P.R. No. 19139
Page 2-09/02/2015
of$580,633.00 as delineated in Exhibit "A," with the understanding that the grant
requires a 10% local match of$58,063.00.
Section 3. That. a copy of the caption of this Resolution be spread upon the
Minutes of the City Council.
READ, ADOPTED, AND APPROVED, this day of September 2015,
A.D., at a Regular Meeting of the City Council of the City of Port Arthur, Texas by the
following Vote: AYES:
Mayor:
Councilmembers:
NOES:
Mayor
ATTEST:
Sherri Bellard, City Secretary
APPROVED AS TO FORM:
C- I /
Val Tizeno, City AO rney
P. R. NO. 19139
Page 3—09/02/2015
APPROVED FOR ADMINISTRATION:
gydAib rnitibIW 6SIV
Brian McDougal, City Manager JV1ith Smith, RN, BSN,
Director of Health Services
APPROVED FOR AVAILABILITY OF FUNDS:
Jerry W. Dale, Interim Director of Finance
(10% Local Match Funds)
EXHIBIT "A"
HHSC Uniform Terms and Conditions Version 1.5
Published and Effective: April 01, 2015
Responsible Office: Chief Counsel
TEXAS
6L ( Health and Human
Services Commission
Health and Human Services Commission
HHSC Uniform Terms and Conditions
Version 1.5
CHECK THE MASTER AT http://www.hhsc.state.tx.us/about hhsc/Contractinq/rfp attch/General TC.pdf
TO VERIFY THAT THIS IS THE CORRECT VERSION BEFORE USE
HHSC Uniform Terms and Conditions Version 1.5
Published and Effective: April 01, 2015
Responsible Office: Chief Counsel
CONTENTS
Article 1. Introduction 1
Section 1.01 Inducements. 1
Section 1.02 Construction of Agreement. 1
(a) Scope of Introductory Article. 1
(b) References to the"State." 1
(c) Severability. 1
(d) Survival of terms 1
(e) Headings. 1
(f) Global drafting conventions 1
Section 1.03 No implied authority. 2
Section 1.04 Legal Authority. 2
Article 2. Definitions 2
Article 3. General Terms and Conditions 4
Section 3.01 Agreement elements 4
(a) Entire Agreement 4
(b) Order of precedence 4
Section 3.02 Funding. 4
Section 3.03 Delegation of authority 4
Section 3.04 No waiver of sovereign immunity 4
Section 3.05 Force majeure 4
Section 3.06 Other Health and Human Services Agencies' participation in the Agreement. 4
Section 3.07 Most favored customer. 5
Section 3.08 Publicity 5
(a) No Use 5
(b) Limited Exception 5
Section 3.09 Assignment. 5
(a) Assignment by CONTRACTOR. 5
(b) Assignment by HHSC 5
(c) Assumption. 5
Section 3.10 Cooperation with other vendors and prospective vendors. 5
(a) Supplemental Contracts 5
(b) Access 5
Section 3.11 Renegotiation and reprocurement rights. 5
(a) Renegotiation of Agreement terms 5
(b) Reprocurement of the services or procurement of additional services. 6
(c) Termination rights upon reprocurement. 6
Section 3.12 Solicitation errors and omissions. 6
Section 3.13 Attorneys'fees. 6
Section 3.14 Preferences under service contracts. 6
Section 3.15 Ensuring timely performance. 6
Article 4.Contractor Personnel Management 6
Section 4.01 Qualifications, retention and replacement of CONTRACTOR employees. 6
Section 4.02 Responsibility for CONTRACTOR personnel. 6
(a) Employment and Agency 6
(b) E-Verify System 6
(c) Liability 7
Section 4.03 Cooperation with HHSC and state administrative agencies. 7
(a) Cooperation with HHSC contractors. 7
(b) Cooperation with state and federal administrative agencies 7
CHECK THE MASTER AT http://www.hhsc.state.tx.us/about hhsc/Contractinq/rfp attch/General TC.pdf
TO VERIFY THAT THIS IS THE CORRECT VERSION BEFORE USE
HHSC Uniform Terms and Conditions Version 1.5
Published and Effective: April 01, 2015
Responsible Office: Chief Counsel
Section 4.04 Conduct of and responsibility for CONTRACTOR personnel. 7
(a) Conduct 7
(b) Removal 7
(c) Sole Control 7
Section 4.05 Responsibility for subcontractors 8
Section 4.06 HHSC's ability to contract with subcontractors. 8
Article 5. Governing Law and Regulations 8
Section 5.01 Governing law and venue. 8
Section 5.02 CONTRACTOR responsibility for compliance with laws and regulations 8
Section 5.03 Compliance with immigration laws 9
Section 5.04 Compliance with anti-discrimination laws, regulations, and rules. 9
Section 5.05 Compliance with environmental protection laws 9
(a) Pro-Children Act of 1994. 9
(b) National Environmental Policy Act of 1969. 10
(c) Clean Air Act and Water Pollution Control Act regulations. 10
(d) State Clean Air Implementation Plan. 10
(e) Safe Drinking Water Act of 1974. 10
Section 5.06 Compliance with Fraud, Waste, and Abuse requirements. 10
Section 5.07 Electronic and Information Resources Accessibility Standards. 10
(a) Applicability 10
(b) Definitions. 10
(c) Evaluation, Testing, and Monitoring. 10
(d) Representations and Warranties 11
(e) Remedies. 11
Section 5.08 Prohibition Against Performance Outside the United States. 11
(a) Authority 11
(b) Prohibition 12
(c) Meaning of"within the United States" and "outside the United States." 12
(d) Maintenance of Confidential Information 12
(e) Performance of Work under Agreement 12
(f) Exceptions 12
(g) Disclosure 13
(h) Remedy 13
Article 6. Service Levels and Performance Measurement 13
Section 6.01 Performance measurement. 13
Article 7.Amendments, Modifications, and Change Order Requests 13
Section 7.01 Amendments and modifications 13
(a) Amendments and modifications resulting from changes in law or contract. 13
(b) Modifications resulting from imposition of remedies. 13
Section 7.02 Required compliance with amendment modification procedures. 13
Article 8.Audit and Financial Compliance 13
Section 8.01 Record retention and audit. 13
Section 8.02 Access to records, books, and documents. 14
(a) Notice 14
(b) Access 14
(c) Entities 14
(d) Accommodations 14
Section 8.03 Audits and inspections of Services and Deliverables 14
Section 8.04 Response/compliance with audit or inspection findings. 14
Section 8.05 Audit of CONTRACTOR fees. 15
Section 8.06 SAO Audit. 15
CHECK THE MASTER AT http://www.hhsc.state.tx.us/about hhsc/Contracting/rfp attch/General TC.pdf
TO VERIFY THAT THIS IS THE CORRECT VERSION BEFORE USE
HHSC Uniform Terms and Conditions Version 1.5
Published and Effective: April 01, 2015
Responsible Office: Chief Counsel
Article 9. Terms and Conditions of Payment 15
Section 9.01 Rights of set-off 15
(a) General right of set-off 15
(b) Duty to make payments 15
Section 9.02 Expenses. 15
Section 9.03 Disputed fees. 15
Section 9.04 Liability for taxes. 16
Section 9.05 Liability for employment-related charges and benefits. 16
Section 9.06 No additional consideration. 16
Section 9.07 No increase in rates 16
Article 10. Disclosure and Confidentiality of Information 16
Section 10.01 Confidentiality. 16
(a) HHSC Data Use Agreement 16
Section 10.02 Requests for public information. 16
Section 10.03 Privileged Work Product. 16
Section 10.04 Unauthorized acts. 17
Section 10.05 Legal action 17
Article 11. Remedies and Disputes 17
Section 11.01 Understanding and expectations. 17
Section 11.02 Tailored remedies. 17
(a) Understanding of the Parties. 17
(b) Notice and opportunity to cure for non-material breach. 17
(c) Corrective action plan 18
(d) Administrative remedies. 18
(e) Damages. 19
(f) Equitable Remedies 19
(g) Suspension of Agreement 19
Section 11.03 Termination of Agreement. 20
(a) Termination by mutual agreement of the Parties. 20
(b) Termination in the best interest of the State 20
(c) Termination for cause 20
Section 11.04 Effective date of termination. 21
Section 11.05 Extension of termination effective date 21
Section 11.06 Payment and other provisions at Agreement termination. 21
Section 11.07 Modification of Agreement in the event of remedies. 21
Section 11.08 Turnover assistance. 21
Section 11.09 Rights upon termination or expiration of Agreement. 22
Section 11.10 CONTRACTOR responsibility for associated costs 22
Section 11.11 Dispute resolution. 22
(a) General agreement of the Parties. 22
(b) Duty to negotiate in good faith 22
(c) Claims for breach of Agreement 22
Section 11.12 Liability of CONTRACTOR. 23
Article 12.Assurances and Certifications 23
Section 12.01 Proposal certifications 23
Section 12.02 Conflicts of interest. 23
(a) Representation. 23
(b) General duty regarding conflicts of interest 23
Section 12.03 Organizational conflicts of interest 23
(a) Definition 23
(b) Warranty. 23
(c) Continuing duty to disclose. 24
CHECK THE MASTER AT http.//www.hhsc.state.tx.us/about hhsc/Contracting/rfp attch/General TC.pdf
TO VERIFY THAT THIS IS THE CORRECT VERSION BEFORE USE
HHSC Uniform Terms and Conditions Version 1.5
Published and Effective: April 01, 2015
Responsible Office: Chief Counsel
(d) Remedy. 24
(e) Flow down obligation. 24
Section 12.04 HHSC personnel recruitment prohibition. 24
Section 12.05 Anti-kickback provision. 24
Section 12.06 Debt or back taxes owed to the State of Texas 24
Section 12.07 Certification regarding status of license, certificate, or permit. 24
Section 12.08 Outstanding debts and judgments. 24
Section 12.09 Anti-trust 24
Article 13. Representations and Warranties 25
Section 13.01 Authorization. 25
Section 13.02 Ability to perform. 25
Section 13.03 Workmanship and performance 25
Section 13.04 Warranty of deliverables. 25
Section 13.05 Manufacturers'warranties. 25
Section 13.06 Compliance with Agreement 25
Article 14. Intellectual Property 25
Section 14.01 Infringement and misappropriation. 25
Section 14.02 Exceptions. 26
Article 15. Liability 26
Section 15.01 Property damage. 26
Section 15.02 Risk of Loss. 26
Section 15.03 Limitation of HHSC's Liability 26
Article 16. Special Terms and Conditions 27
Section 16.01 HHSC Data Use Agreement Not Required 27
Section 16.02 Financial/performance audits 28
Section 16.03 Audit software. 28
Section 16.04 Ownership and licenses 28
(a) Custom software 28
(b) Ownership rights 28
(c) License Rights 29
(d) Proprietary Notices 29
(e) Third Party Software and Documentation Licenses 29
(f) State and Federal Governments 29
Section 16.05 Insurance Coverage. 29
(a) Required Coverage. 29
(b) Proof of Insurance Coverage 30
Section 16.06 Background Checks 30
Section 16.07 Historically Underutilized Business Participation Requirements 31
(a) Definitions. 31
(b) HUB Requirements. 31
CHECK THE MASTER AT http://www.hhsc.state.tx.us/about hhsc/Contracting/rfp attch/General TC.pdf
TO VERIFY THAT THIS IS THE CORRECT VERSION BEFORE USE
Article 1. Introduction
Section 1.01 Inducements.
In making the award of the Agreement,the Health and Human Services Commission (HHSC) relies on
CONTRACTOR's assurances of the following:
(1)CONTRACTOR and its subcontractors are established providers of the types of services described in the
Solicitation;
(2)CONTRACTOR and its subcontractors have the skills, qualifications, expertise,financial resources, and
experience necessary to perform the services described in the Solicitation, CONTRACTOR's Proposal, and the
Agreement in an efficient, cost-effective manner,with a high degree of quality and responsiveness, and has
performed similar services for other public or private entities;
(3)CONTRACTOR has thoroughly reviewed, analyzed, and understood the Solicitation, has timely raised all
questions or objections to the Solicitation, and has had the opportunity to review and fully understand the HHSC's
current program and operating environment for the activities that are the subject of the Agreement and the needs
and requirements of the State during the Agreement term;
(4)CONTRACTOR has had the opportunity to review and understand the State's stated objectives in
entering into the Agreement and, based on such review and understanding, CONTRACTOR currently has the
capability to perform in accordance with the terms and conditions of the Agreement;
(5)CONTRACTOR also has reviewed and understands the risks associated with the HHSC Programs as
described in the Solicitation, including the risk of non-appropriation of funds.
Accordingly, HHSC desires to engage CONTRACTOR to perform the services described in the Agreement
under the terms and conditions set forth in the Agreement.
Section 1.02 Construction of Agreement.
(a) Scope of Introductory Article.
The provisions of any introductory article to the Agreement are intended to be a general introduction and are not
intended to expand the scope of the Parties'obligations under the Agreement or to alter the plain meaning of the
terms and conditions of the Agreement.
(b) References to the "State."
References in the Agreement to the"State"mean the State of Texas unless otherwise indicated and will be
interpreted, as appropriate, to mean or include HHSC and other agencies of the State of Texas that may participate in
the administration of HHSC Programs, provided, however, that no provision will be interpreted to include any entity
other than HHSC as the contracting agency.
(c) Severability.
If any provision of the Agreement is for any reason held to be unenforceable, the rest of it remains fully
enforceable.
(d) Survival of terms.
Termination or expiration of the Agreement for any reason will not release either Party from any liabilities or
obligations set forth in the Agreement that:
(1)The Parties agree will survive the termination or expiration; or
(2) Remain to be performed or by their nature would be intended to be applicable following any such
termination or expiration.
(e) Headings.
The article and section headings in the Agreement are for reference and convenience only and may not be
considered in the interpretation of the Agreement.
(f) Global drafting conventions.
(1)The terms"include,""includes,"and"including"are terms of inclusion and enlargement, and where used in
the Agreement, should be read as if followed by the phrase"without limitation."
(2)Any references to"sections,""appendices,"or"attachments"are references to sections, appendices, or
attachments of the Agreement.
(3)Any references to agreements, contracts, statutes, or administrative rules or regulations in the Agreement are
references to these documents as amended, modified, or supplemented from time to time during the term of the
Agreement.
Page 1 of 31
Section 1.03 No implied authority.
The authority delegated to CONTRACTOR by HHSC is limited to the terms of the Agreement. HHSC is the state
agency designated by the Texas Legislature to administer the HHSC Programs, and no other state agency grants
CONTRACTOR any authority related to the Agreement unless directed through HHSC. CONTRACTOR may not rely
upon implied authority and is not delegated authority under the Agreement to:
(1)make public policy;
(2)promulgate, amend, or disregard administrative regulations or program policy decisions made by State and
federal agencies responsible for administration of HHSC Programs; or
(3)unilaterally communicate or negotiate with any federal or state agency or the Texas Legislature on behalf of
HHSC regarding HHSC Programs or the Agreement.
To the fullest extent possible, CONTRACTOR is required to assist HHSC in communications and negotiations
with state and federal governments and agencies as directed by HHSC.
Section 1.04 Legal Authority.
(a) HHSC is authorized to enter into the Agreement under Chapter 531 or 533, Texas Government Code;
Section 2155.144, Texas Government Code; or Chapter 62, Texas Health &Safety Code. CONTRACTOR is
authorized to enter into the Agreement pursuant to the authorization of its governing board or controlling owner or
officer.
(b)The person or persons signing and executing the Agreement on behalf of the Parties, or representing
themselves as signing and executing the Agreement on behalf of the Parties,warrant and guarantee that he, she, or
they have been duly authorized to execute the Agreement and to validly and legally bind the Parties to all of its terms,
performances, and provisions.
Article 2. Definitions
As used in the Agreement, the following terms and conditions have the meanings assigned below:
"Agreement" means the formal,written, and legally enforceable agreement and amendments between the
Parties.
"Change"means any alteration, adjustment, exchange, substitution, or modification of the Services under the
Agreement that are authorized in accordance with Article 7 of the Agreement.
"Change Order Request"means a request to make a change in the Services or Deliverables under the
Agreement.
"Children's Health Insurance Program"or"CHIP"means the health insurance program authorized and
funded pursuant to Title XXI, Social Security Act(42 U.S.C. §§ 1397aa-1397jj)and administered by HHSC.
"Confidential Information"means any communication or record (whether oral, written, electronically stored or
transmitted, or in any other form)provided to or made available to CONTRACTOR or that CONTRACTOR may
create, receive, maintain, use, disclose or have access to on behalf of HHS that consists of or includes any or all of
the following:
(1)Client Information;
(2) Protected Health Information in any form including without limitation, Electronic Protected Health Information
or Unsecured Protected Health Information;
(3)Sensitive Personal Information defined by Texas Business and Commerce Code Ch. 521;
(4) Federal Tax Information;
(5) Personally Identifiable Information;
(6)Social Security Administration Data, including, without limitation, Medicaid information;
(7)All privileged work product;
(8)All information designated as confidential under the constitution and laws of the State of Texas and of the
United States, including the Texas Health&Safety Code and the Texas Public Information Act, Texas Government
Code, Chapter 552; and
(9)Other Confidential Information as designated in the Agreement.
"CONTRACTOR"means the Party identified in the Agreement as the individual or entity that is required to
perform the Services and related obligations under the Agreement.
"Corrective Action Plan" means the detailed written plan required by HHSC to correct or resolve a material
deficiency or breach of the Agreement.
"Deliverable" means a work product prepared, developed, or procured by CONTRACTOR as part of the
Services under the Agreement for the use or benefit of HHSC or the State of Texas.
"Disability"means a physical or mental impairment that substantially limits one or more of the major life
activities of an individual.
Page 2 of 31
"Effective Date"means the date of complete execution of the Agreement unless another date is agreed to by
the Parties as the date on which the Agreement takes effect. For purposes of the Agreement, the term includes any
period under which work is performed in accordance with a properly executed Letter of Intent between HHSC and
CONTRACTOR.
"Electronic and information resources(EIR)"—Includes information technology and any equipment or
interconnected system or subsystem of equipment used to create, convert, duplicate, or deliver data or information.
EIR includes telecommunications products(such as telephones), information kiosks and transaction machines, web
sites, multimedia, and office equipment such as copiers and fax machines. The term does not include any equipment
that contains embedded information technology that is used as an integral part of the product, but the principal
function of which is not the acquisition, storage, manipulation, management, movement, control, display, switching,
interchange,transmission, or reception of data or information. For example, thermostats or temperature control
devices, and medical equipment that contain information technology that is integral to its operation, are not
information technology. If the embedded information technology has an externally available web or computer
interface,that interface is considered EIR. Other terms such as, but not limited to, Information and Communications
Technology(ICT), Electronic Information Technology(EIT), etc. can be considered interchangeable terms with EIR
for purposes of the Agreement.
"Health and Human Services Commission"or"HHSC" means the administrative agency within the
executive department of Texas state government established under Chapter 531, Texas Government Code or its
designee, including, but not limited to, the Texas Health and Human Services Agencies.
"HHSC Programs"means the public health and human service programs administered by HHSC, including but
not limited to Medicaid and CHIP.
"Initial Term"means the period between the Effective Date and the original expiration date of the Agreement.
"Material Subcontract"means any Subcontract that exceeds, or is reasonably expected to exceed, $100,000
per year.Any Subcontracts between the CONTRACTOR and a single entity that are split into separate agreements
by time period, program, or service area, etc., may be consolidated for the purpose of this definition.
"Material Subcontractor(or Major Subcontractor)" means any entity with a Material Subcontract with
CONTRACTOR.
"Medicaid"means the medical assistance entitlement program authorized and funded pursuant to Title XIX,
Social Security Act(42 U.S.C. § 1396 et seq.)and administered by HHSC.
"Other Confidential Information"means any communication or record(whether oral,written, electronically
stored or transmitted, or in any other form)provided to or made available to CONTRACTOR or that CONTRACTOR
may create, receive, maintain, use, disclose or have access to on behalf of HHSC that is expressly designated as
Other Confidential Information in the Agreement.
"Parties"means HHSC and CONTRACTOR, collectively.
"Party"means either HHSC or CONTRACTOR, individually.
"Proposal"means the proposal submitted by the CONTRACTOR in response to the Solicitation.
"Public information"means information that:
(1)Is collected, assembled, or maintained under a law or ordinance or in connection with the transaction of
official business by a governmental body or for a governmental body;
(2)The governmental body owns or has a right of access to; and
(3) Is not Confidential Information.
"Solicitation"means the written invitation for bids, request for offers, request for proposals, or similar
instrument that is posted on the HHSC Website and/or Electronic State Business Daily, seeking responses from
qualified vendors for needed goods and services.This term also includes"price requests"and"pricing requests"sent
to Department of Information Resources vendors to get pricing, based on a specific scope of work,through a
Cooperative Contract or DBITS contract. and any addendums under which the Agreement was awarded and is
executed.
"Scope of Work"means the description of Services and Deliverables specified in the Agreement,the
Solicitation, and any agreed modifications.
"Services"means the tasks, functions, and responsibilities assigned and delegated to CONTRACTOR under
the Agreement.
"Software"means all operating system and applications software used or created by CONTRACTOR to
provide the Services under the Agreement.
"Subcontract"means any written agreement between CONTRACTOR and other party to fulfill the
requirements of the Agreement.All subcontracts are required to be in writing.
"Subcontractor" means any individual or entity that has entered into a subcontract with CONTRACTOR.
Page 3 of 31
"Turnover Plan"means the written plan developed by CONTRACTOR, approved by HHSC, and to be
employed in the event that the work described in the Agreement transfers to the State or another vendor from
CONTRACTOR. HHSC may require CONTRACTOR to develop a Turnover Plan at any time during the term of the
Agreement at HHSC's discretion. The Turnover Plan describes CONTRACTOR's policies and procedures that will
assure:
(1)The least disruption in the delivery of services during the transition to a substitute vendor; and
(2)Cooperation with HHSC and the substitute vendor in transferring information and services to a substitute
vendor.
Article 3.General Terms and Conditions
Section 3.01 Agreement elements.
(a) Entire Agreement.
The Agreement between the Parties will consist of the document bearing the signatures of the Parties, Exhibits,
or Attachments to that document,these Uniform Terms and Conditions, the Solicitation (CONTRACTOR's Proposal
and any agreed to modifications(incorporated by reference).
(b) Order of precedence.
Unless otherwise agreed, in the event of any conflict or contradiction between or among these documents, the
documents will control in the following order of precedence:
(1)The final executed document that bears the signature of the Parties, including any Exhibits or
attachments, and all amendments to that document;
(2)These Uniform Terms and Conditions, including any attachments;
(3)The Solicitation and any addendums, corrections, and clarifications. ;
(4)CONTRACTOR's Proposal and any agreed to modifications.
Section 3.02 Funding.
The Agreement is conditioned on the availability of state and federal appropriated funds. CONTRACTOR will
have no right of action against HHSC in the event that HHSC is unable to perform its obligations under the
Agreement as a result of the suspension, termination,withdrawal of funding to HHSC, the failure to fund HHSC, or
lack of sufficient funding of HHSC for any activities or functions contained within the scope of the Agreement. If funds
become unavailable,the provisions of Article 11 (Remedies and Disputes)will apply. HHSC will use all reasonable
efforts to ensure that such funds are available, and will negotiate in good faith with CONTRACTOR to resolve any
CONTRACTOR claims for payment that represent accepted Services or Deliverables that are pending at the time
funds become unavailable. HHSC will make best efforts to provide reasonable written advance notice to
CONTRACTOR upon learning that funding for the Agreement may be discontinued.
Section 3.03 Delegation of authority.
Whenever, by any provision of the Agreement, any right, power, or duty is imposed or conferred on HHSC,the
right, power, or duty so imposed or conferred is possessed and exercised by HHSC's Executive Commissioner
unless any right, power, or duty is delegated to the duly appointed agents or employees of HHSC. HHSC's Executive
Commissioner will reduce any delegation of authority to writing and provide a copy to CONTRACTOR on request.
Section 3.04 No waiver of sovereign immunity.
The Parties agree that no provision of the Agreement is in any way intended to constitute a waiver by HHSC or
the State of Texas of any immunities from suit or from liability that HHSC or the State of Texas may have by
operation of law.
Section 3.05 Force majeure.
A Party will not be liable for any failure or delay in performing its obligations under the Agreement if such failure
or delay is due to any cause beyond the reasonable control of the Party, including, but not limited to, unusually
severe weather, strikes, natural disasters, fire, civil disturbance, epidemic, war, court order, or acts of God. The
existence of such causes of delay or failure will extend the period of performance in the exercise of reasonable
diligence until after the causes of delay or failure have been removed. Each Party must inform the other in writing with
proof of receipt within five(5) business days of the existence of a force majeure event as described above or
otherwise waive this right as a defense.
Section 3.06 Other Health and Human Services Agencies'participation in the Agreement.
In addition to providing the Services specified for HHSC, CONTRACTOR agrees to allow other Health and
Human Service Agencies the option to participate in the Agreement under the same terms and conditions. Each
Page 4 of 31
agency that elects to obtain services under this section will issue a purchase order to CONTRACTOR, referring to,
and incorporating by reference,the terms and conditions specified in the Agreement.
Section 3.07 Most favored customer.
The CONTRACTOR agrees that if during the term of the Agreement,the CONTRACTOR enters into any
agreement with any other governmental customer, or any non-affiliated commercial customer by which it agrees to
provide equivalent services at lower prices, or additional services at comparable prices, the Agreement will, at
HHSC's option, be amended to accord equivalent advantage to HHSC.
Section 3.08 Publicity.
(a) No Use
Except as provided in the paragraphs below, CONTRACTOR must not use the name of, or directly or indirectly
refer to, HHSC,the State of Texas, or any other State agency in any media release, public announcement, or public
disclosure relating to the Agreement or its subject matter, including in any promotional or marketing materials,
customer lists, or business presentations(other than proposals or reports submitted to HHSC, an administrative
agency of the State of Texas, or a governmental agency or unit of another state or the Federal government).
(b) Limited Exception
CONTRACTOR may publish, at its sole expense, results of CONTRACTOR performance under the Agreement
with HHSC's prior review and approval,which HHSC may exercise at its sole discretion.Any publication (written,
visual, or sound)will acknowledge the support received from HHSC and any Federal agency, as appropriate.
CONTRACTOR will provide HHSC at least three(3)copies of any such publication prior to public release.
CONTRACTOR will provide additional copies at the request of HHSC. CONTRACTOR may include information
concerning the Agreement's terms, subject matter, and estimated value in any report to a governmental body to
which the CONTRACTOR is required by law to report such information.
Section 3.09 Assignment.
(a) Assignment by CONTRACTOR.
CONTRACTOR will not assign all or any portion of its rights under or interests in the Agreement or delegate any
of its duties without prior written consent of HHSC.Any written request for assignment or delegation must be
accompanied by written acceptance of the assignment or delegation by the assignee or delegation by the delegate.
Except where otherwise agreed in writing by HHSC, assignment or delegation will not release CONTRACTOR from
its obligations under the Agreement.
(b) Assignment by HHSC.
CONTRACTOR understands and agrees HHSC may in one or more transactions assign, pledge, or transfer the
Agreement. This assignment will only be made to another State agency or a non-state agency that is contracted to
perform agency support.
(c) Assumption.
Each party to whom a transfer is made must assume all or any part of CONTRACTOR'S or HHSC's interests in
the Agreement,the product, and any documents executed with respect to the Agreement, including, without
limitation,the assignor's obligation for all or any portion of the purchase payments, in whole or in part.
Section 3.10 Cooperation with other vendors and prospective vendors.
(a) Supplemental Contracts
HHSC may award supplemental contracts for work related to the Agreement, or any portion thereof. HHSC
reserves the right to award the Contract as a joint venture between two or more potential vendors, if such an
arrangement is in the best interest of HHSC. CONTRACTOR agrees to cooperate with such other vendors, and will
not commit or permit any act that may interfere with the performance of work by any other vendor.
(b) Access
At HHSC's request, CONTRACTOR will allow parties interested in responding to HHSC Solicitations to have
reasonable access during normal business hours to software, systems documentation, and site visits to the
CONTRACTOR's facilities.All such parties inspecting the facilities and software and systems documentation may be
required to agree to use the information so obtained only in the State of Texas and only for the purpose of responding
to the Solicitation.
Section 3.11 Renegotiation and reprocurement rights.
(a) Renegotiation of Agreement terms.
Notwithstanding anything in the Agreement to the contrary, HHSC may at any time during the term of the
Agreement exercise the option to notify CONTRACTOR that HHSC has elected to renegotiate certain terms of the
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Agreement within the scope of the Agreement and as permitted by law. Upon CONTRACTOR's receipt of any notice
under this Section, CONTRACTOR and HHSC will undertake good faith negotiations of the subject terms of the
Agreement.
(b) Reprocurement of the services or procurement of additional services.
Notwithstanding anything in the Agreement to the contrary, whether or not HHSC has accepted or rejected
CONTRACTOR's Services or Deliverables provided during any period of the Agreement, HHSC may at any time
issue requests for proposals or offers to other potential contractors for performance of any portion of the Services
covered by the Agreement or services similar or comparable to the Services performed by CONTRACTOR under the
Agreement.
(c) Termination rights upon reprocurement.
If HHSC elects to procure the Services or any portion of the Services from another vendor in accordance with
this Section, HHSC will have the termination rights set forth in Article 11.
Section 3.12 Solicitation errors and omissions.
CONTRACTOR will not take advantage of any errors or omissions in the Solicitation or the resulting Agreement.
CONTRACTOR must promptly notify HHSC of any errors or omissions that are discovered. Failure to notify HHSC of
any errors will constitute a waiver of those errors.
Section 3.13 Attorneys'fees.
In the event of any litigation, appeal, or other legal action to enforce any provision of the Agreement,
CONTRACTOR agrees to pay all expenses of such action, including attorneys'fees and costs if HHSC is the
prevailing or substantially prevailing Party.
Section 3.14 Preferences under service contracts.
CONTRACTOR is required in performing the Agreement to purchase products and materials produced in the
State of Texas when they are available at a price and time comparable to products and materials produced outside
the State.
Section 3.15 Ensuring timely performance.
The Parties acknowledge the need to ensure uninterrupted and continuous performance of the Scope of Work
under the Agreement, therefore, HHSC may terminate the Agreement or apply any other remedy as noted in Article
11 (Remedies and Disputes)if CONTRACTOR's performance is not timely.
Article 4.Contractor Personnel Management
Section 4.01 Qualifications, retention and replacement of CONTRACTOR employees.
CONTRACTOR agrees to maintain the organizational and administrative capacity and capabilities to carry out
all duties and responsibilities under the Agreement. The personnel CONTRACTOR assigns to perform the duties and
responsibilities under the Agreement will be properly trained and qualified for the functions they are to perform.
CONTRACTOR does not warrant the quality of training for which the State is responsible. Notwithstanding transfer or
turnover of personnel, CONTRACTOR remains obligated to perform all duties and responsibilities under the
Agreement without degradation and in accordance with the terms of the Agreement.
Section 4.02 Responsibility for CONTRACTOR personnel.
(a) Employment and Agency
CONTRACTOR's employees and subcontractors will not in any sense be considered employees of HHSC or the
State of Texas, but will be considered CONTRACTOR's employees for all purposes. Except as provided in the
Agreement, neither CONTRACTOR nor any of CONTRACTOR's employees or subcontractors may act in any sense
as agents or representatives of HHSC or the State of Texas.
(b) E-Verify System
By entering into this Contract, the Contractor certifies and ensures that it utilizes and will continue to
utilize, for the term of this Contract, the U.S. Department of Homeland Security's E-Verify system to
determine the eligibility of:
1. All persons employed to perform duties within Texas, during the term of the Contract; and
2. All persons (including subcontractors) assigned by the Respondent to perform work
pursuant to the Contract, within the United States of America.
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(c) Liability
CONTRACTOR's employees must be paid exclusively by CONTRACTOR for all services performed.
CONTRACTOR is responsible for and must comply with all requirements and obligations related to such employees
under local, state or federal law, including minimum wage, social security, unemployment insurance, state and federal
income tax, and workers'compensation obligations. CONTRACTOR assumes sole and full responsibility for its acts
and omissions and the acts and omissions of its personnel and subcontractors.
CONTRACTOR AGREES THAT ANY CLAIM ON BEHALF OF ANY PERSON ARISING OUT OF
EMPLOYMENT OR ALLEGED EMPLOYMENT(INCLUDING, BUT NOT LIMITED TO,CLAIMS OF
DISCRIMINATION AGAINST CONTRACTOR, ITS OFFICERS,OR ITS AGENTS)ARE THE SOLE
RESPONSIBILITY OF CONTRACTOR AND ARE NOT THE RESPONSIBILITY OF HHSC,AND THAT
CONTRACTOR WILL INDEMNIFY AND HOLD HARMLESS THE STATE FROM ANY AND ALL SUCH CLAIMS
ASSERTED AGAINST THE STATE.
CONTRACTOR understands that any person who alleges a claim arising out of employment or alleged
employment by CONTRACTOR will not be entitled to any compensation, rights, or benefits from HHSC(including, but
not limited to,tenure rights, medical and hospital care, sick and annual/vacation leave, severance pay, or retirement
benefits).
Section 4.03 Cooperation with HHSC and state administrative agencies.
(a) Cooperation with HHSC contractors.
CONTRACTOR agrees to reasonably cooperate with and work with the State's contractors,subcontractors and
third-party representatives as requested by HHSC. To the extent permitted by HHSC's financial and personnel
resources, HHSC agrees to reasonably cooperate with CONTRACTOR and to use its best efforts to ensure that
HHSC's other HHSC Programs contractors reasonably cooperate with CONTRACTOR.
(b) Cooperation with state and federal administrative agencies.
CONTRACTOR must ensure that CONTRACTOR personnel will cooperate with HHSC or other state or federal
administrative agency personnel at no charge to HHSC for purposes relating to the administration of HHSC programs
including, but not limited to the following purposes:
(1)The investigation and prosecution of fraud, abuse, and waste in the HHSC programs;
(2)Audit, inspection, or other investigative purposes; and
(3)Testimony in judicial or quasi-judicial proceedings relating to the Services under the Agreement or other
delivery of information to HHSC or other agencies' investigators or legal staff.
Section 4.04 Conduct of and responsibility for CONTRACTOR personnel.
(a) Conduct
While performing the Services or Deliverables, CONTRACTOR's personnel and subcontractors must:
(1)Comply with applicable Agreement terms, State and federal rules, regulations, HHSC's policies, and
HHSC's requests regarding personal and professional conduct; and
(2)Otherwise conduct themselves in a businesslike and professional manner.
(b) Removal
If HHSC determines in good faith that a particular employee or subcontractor is not conducting himself or herself
in accordance with this Section, HHSC may provide CONTRACTOR with notice and documentation concerning such
conduct. Upon receipt of such notice, CONTRACTOR must promptly investigate the matter and, at HHSC's request,
take appropriate action that may include:
(1) Removing the employee from the project;
(2) Providing HHSC with written notice of such removal; and
(3)Replacing the employee with a similarly qualified individual acceptable to HHSC.
Nothing in the Agreement will prevent CONTRACTOR, at the request of HHSC, from replacing any personnel
who HHSC determines are not adequately performing their assigned responsibilities or who, in the reasonable
opinion of HHSC's Project Director, after consultation with CONTRACTOR, are unable to work effectively with the
members of the HHSC's staff. In such event, CONTRACTOR will provide replacement personnel with equal or
greater skills and qualifications as soon as reasonably practicable. Replacement of Key Personnel will be subject to
HHSC review and approval. The Parties will work together in the event of any such required replacement so as not to
disrupt the overall project schedule.
(c) Sole Control
CONTRACTOR agrees that anyone employed by CONTRACTOR to fulfill the terms of the Agreement is an
employee of CONTRACTOR and remains under CONTRACTOR's sole direction and control.
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CONTRACTOR agrees to be responsible for the following with respect to its employees:
(1)Any and all employment taxes or other payroll withholding;
(2) Damages caused by CONTRACTOR's employees acting within or outside the scope of their duties under
the Agreement; and
(3) Determination of the hours to be worked and the duties to be performed by CONTRACTOR's employees.
CONTRACTOR agrees and will inform its employees and subcontractor(s)that there is no right of action against
HHSC for any duty owed by CONTRACTOR under the Agreement. CONTRACTOR understands that HHSC does not
assume liability for the actions of, or judgments rendered against, the CONTRACTOR, its employees, agents or
subcontractors. CONTRACTOR agrees that it has no right to indemnification or contribution from HHSC for any
judgments rendered against CONTRACTOR or its subcontractors. HHSC's liability to the CONTRACTOR's
employees, agents and subcontractors, if any, will be governed by the Texas Tort Claims Act, as amended or
modified(Tex. Civ. Pract. &Rem. Code§ 101.001 et seq.).
Section 4.05 Responsibility for subcontractors.
CONTRACTOR remains fully responsible for obligations, services, and functions performed by its
subcontractors to the same extent as if such obligations, services, and functions were performed by
CONTRACTOR'S employees, and for purposes of the Agreement such work will be deemed work performed by
CONTRACTOR. HHSC reserves the right to require the replacement of any subcontractor found by HHSC to be
unacceptable.
CONTRACTOR must not disclose Confidential Information of HHSC or the State of Texas to a subcontractor
unless and until such subcontractor has agreed in writing to protect the confidentiality of such Confidential Information
in the manner required of CONTRACTOR under the Agreement.
CONTRACTOR must identify any subcontractor that is a newly-formed subsidiary or entity,whether or not an
affiliate of CONTRACTOR, substantiate the proposed subcontractor's ability to perform the subcontracted Services,
and certify to HHSC that no loss of service will occur as a result of the performance of such subcontractor. The
CONTRACTOR will assume responsibility for all contractual responsibilities whether or not the CONTRACTOR
performs them. Further, HHSC considers the CONTRACTOR to be the sole point of contact with regard to
contractual matters, including payment of any and all charges resulting from the Agreement.
At least 30 days prior to executing a Material Subcontract or other agreement with a third party with a value
greater than$100,000.00, CONTRACTOR must submit a copy of the agreement to HHSC for HHSC's review at
HHSC's option. HHSC reserves the right to: (1)reject the agreement or require changes to any provisions that do not
comply with the requirements or duties and responsibilities of the Agreement or create significant barriers for HHSC
in monitoring compliance with the Agreement; (2)object to the selection of the subcontractor; or(3)object to the
subcontracting of the Services and Deliverables proposed to be subcontracted.
Section 4.06 HHSC's ability to contract with subcontractors.
The CONTRACTOR may not limit or restrict, through a covenant not to compete, employment agreement or
other contractual arrangement, HHSC's ability to contract with subcontractors or former employees of the
CONTRACTOR.
Article 5.Governing Law and Regulations
Section 5.01 Governing law and venue.
The Agreement is governed by the laws of the State of Texas and interpreted in accordance with Texas law.
Provided CONTRACTOR first complies with the procedures set forth in Section 11.11, Dispute Resolution, proper
venue for a claim arising from the Agreement will be in a court of competent jurisdiction in Travis County, Texas.
Section 5.02 CONTRACTOR responsibility for compliance with laws and regulations.
CONTRACTOR is responsible for compliance with all laws, regulations, and administrative rules that govern the
performance of the Services including all State and Federal tax laws, State and Federal employment laws, State and
Federal regulatory requirements, and licensing provisions.
CONTRACTOR is responsible for ensuring each of its employees, agents, or subcontractors who provide
Services or Deliverables under the Agreement are properly licensed, certified, or have proper permits to perform any
activity related to the Services.
CONTRACTOR warrants that the Services and Deliverables comply with all applicable Federal, State, and
County laws, regulations, codes, ordinances, guidelines, and policies. CONTRACTOR WILL INDEMNIFY AND
HOLD HARMLESS HHSC FROM AND AGAINST ANY LOSSES, LIABILITY,CLAIMS, DAMAGES, PENALTIES,
COSTS, FEES,OR EXPENSES ARISING FROM OR IN CONNECTION WITH CONTRACTOR'S NEGLIGENCE OR
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CONTRACTOR'S FAILURE TO COMPLY WITH OR VIOLATION OF ANY SUCH LAW, REGULATION,CODE,
ORDINANCE,OR POLICY.
Section 5.03 Compliance with immigration laws.
CONTRACTOR must comply with the requirements of the Immigration and Nationality Act(8 U.S.0§ 1101 et
seq.)and all subsequent immigration laws and amendments.
Section 5.04 Compliance with anti-discrimination laws, regulations,and rules.
CONTRACTOR must comply with state and federal anti-discrimination laws, including:
(a)Title VI of the Civil Rights Act of 1964(42 U.S.C. §2000d et seq.);
(b)Section 504 of the Rehabilitation Act of 1973(29 U.S.C. §794);
(c)Americans with Disabilities Act of 1990(42 U.S.C. § 12101 et seq.);
(d)Age Discrimination Act of 1975(42 U.S.C. §§6101-6107);
(e)Title IX of the Education Amendments of 1972(20 U.S.C. §§ 1681-1688);
(f) Food Stamp Act of 1977(7 U.S.C. §200 et seq.); and
(g) HHSC's administrative rules, as set forth in the Texas Administrative Code, to the extent applicable to the
Agreement.
CONTRACTOR must comply with all amendments to the above-referenced laws, and all requirements imposed
by the regulations issued under these laws. These laws provide in part that no persons in the United States may, on
the grounds of race, color, national origin, sex, age, disability, political beliefs, or religion, be excluded from
participation in or denied any aid, care, service or other benefits provided by Federal or State funding, or otherwise be
subjected to discrimination.
CONTRACTOR must comply with Title VI of the Civil Rights Act of 1964, and its implementing regulations at 45
C.F.R. Part 80 and 7 C.F.R. Part 15, prohibiting a contractor from adopting and implementing policies and procedures
that exclude or have the effect of excluding or limiting the participation of clients in its programs, benefits, or activities
on the basis of national origin.Applicable state and federal civil rights laws require contractors to provide alternative
methods for ensuring access to services for applicants and recipients who cannot express themselves fluently in
English. CONTRACTOR must ensure that its policies do not have the effect of excluding or limiting the participation
of persons in its programs, benefits, and activities on the basis of national origin. CONTRACTOR also must take
reasonable steps to provide services and information, both orally and in writing, in appropriate languages other than
English, in order to ensure that persons with limited English proficiency are effectively informed and can have
meaningful access to programs, benefits, and activities.
CONTRACTOR must comply with Executive Order 13279, and its implementing regulations at 45 C.F.R. Part 87
or 7 C.F.R. Part 16.These provide in part that any organization that participates in programs funded by direct
financial assistance from the United States Department of Agriculture or the United States Department of Health and
Human Services will not, in providing services, discriminate against a program beneficiary or prospective program
beneficiary on the basis of religion or religious belief. Upon request, CONTRACTOR will provide HHSC with copies of
all of the CONTRACTOR'S civil rights policies and procedures.
CONTRACTOR must notify HHSC's Civil Rights Office of any civil rights complaints received relating to its
performance under the Agreement.This notice must be delivered no more than ten calendar days after receipt of a
complaint. Notice provided under this section must be directed to:
HHSC Civil Rights Office
701 W.51St Street,Mail Code W206
Austin,Texas 78751
Phone Toll Free: (888)388-6332
Phone: (512)438-4313
TTY Toll Free: (877)432-7232
Fax: (512)438-5885.
Section 5.05 Compliance with environmental protection laws.
CONTRACTOR must comply with state and federal environmental laws, including, without limitation:
(a) Pro-Children Act of 1994.
CONTRACTOR must comply with the Pro-Children Act of 1994(20 U.S.C. §6081 et seq.), as applicable,
regarding the provision of a smoke-free workplace and promoting the non-use of all tobacco products.
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(b) National Environmental Policy Act of 1969.
CONTRACTOR must comply with any applicable provisions relating to the institution of environmental quality
control measures contained in the National Environmental Policy Act of 1969(42 U.S.C. §4321 et seq.)and
Executive Order 11514("Protection and Enhancement of Environmental Quality").
(c) Clean Air Act and Water Pollution Control Act regulations.
CONTRACTOR must comply with any applicable provisions relating to required notification of facilities violating
the requirements of Executive Order 11738("Providing for Administration of the Clean Air Act and the Federal Water
Pollution Control Act with Respect to Federal Contracts, Grants, or Loans").
(d) State Clean Air Implementation Plan.
CONTRACTOR must comply with any applicable provisions requiring conformity of federal actions to State
(Clean Air) Implementation Plans under§176(c)of the Clean Air Act of 1955, as amended(42 U.S.C. §7401 et seq.).
(e) Safe Drinking Water Act of 1974.
CONTRACTOR must comply with applicable provisions relating to the protection of underground sources of
drinking water under the Safe Drinking Water Act of 1974, as amended(21 U.S.C. §349; 42 U.S.C. §§300f to 300j-
9).
Section 5.06 Compliance with Fraud, Waste, and Abuse requirements.
CONTRACTOR, CONTRACTOR's personnel, and all subcontractors must comply with all fraud,
waste, and abuse requirements found in HHS Circular C-027.
Section 5.07 Electronic and Information Resources Accessibility Standards.
(a) Applicability.
The following Electronic and Information Resources(EIR)requirements apply to the Agreement because
CONTRACTOR performs services that include EIR that: (i) HHSC employees are required or permitted to access; or
(ii) members of the public are required or permitted to access. This Section does not apply to incidental uses of EIR
in the performance of the Agreement, unless the Parties agree that the EIR will become property of the State of
Texas or will be used by HHSC's clients or recipients after completion of the Agreement. Nothing in this section is
intended to prescribe the use of particular designs or technologies or to prevent the use of alternative technologies,
provided they result in substantially equivalent or greater access to and use of a Product.
(b) Definitions.
For purposes of this Section:
"Accessibility Standards"means accessibility standards and specifications for Texas agency and institution of
higher education websites and EIR set forth in 1 Tex.Admin. Code Texas Administrative Code, Chapter 206 and/or
Chapter 213
"Electronic and Information Resources"means information resources, including information resources
technologies, and any equipment or interconnected system of equipment that is used in the creation, conversion,
duplication, or delivery of data or information. The term includes telephones and other telecommunications products,
information kiosks, transaction machines, Internet websites, multimedia resources, and office equipment, including
copy machines and fax machines.
"Electronic and Information Resources Accessibility Standards"means the accessibility standards for
electronic and information resources contained in 1 Tex.Admin. Code Chapter 213.
"Product"means information resources technology that is, or is related to, EIR.
"Web Site Accessibility Standards/Specifications" means standards contained in Volume 1 Tex.
Admin. Code Chapter 206.(c)Accessibility Requirements.
Under Tex. Gov't Code Chapter 2054, Subchapter M, and implementing rules of the Texas Department of
Information Resources, HHSC must procure Products and services that comply with the Accessibility Standards
when those Products are available in the commercial marketplace or when those Products are developed in response
to a procurement solicitation.Accordingly, CONTRACTOR must provide electronic and information resources and
associated Product documentation and technical support that comply with the Accessibility Standards.
(c) Evaluation, Testing, and Monitoring.
(1)HHSC may review, test, evaluate and monitor CONTRACTOR's Products and services, as well as
associated documentation and technical support for compliance with the Accessibility Standards. Review, testing,
evaluation and monitoring may be conducted before and after the award of a contract. Testing and monitoring
may include user acceptance testing.
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Neither(1)the review, testing(including acceptance testing), evaluation or monitoring of any Product or
service, nor(2)the absence of review,testing,evaluation or monitoring,will result in a waiver of the State's right
to contest the CONTRACTOR's assertion of compliance with the Accessibility Standards.
(2)CONTRACTOR agrees to cooperate fully and provide HHSC and its representatives timely access to
Products, records, and other items and information needed to conduct such review, evaluation, testing, and
monitoring.
(d) Representations and Warranties.
(1)CONTRACTOR represents and warrants that: (i)as of the Effective Date of the Agreement, the Products
and associated documentation and technical support comply with the Accessibility Standards as they exist at the
time of entering the Agreement, unless and to the extent the Parties otherwise expressly agree in writing; and(ii)
if the Products will be in the custody of the state or an HHS Agency's client or recipient after the Contract
expiration or termination,the Products will continue to comply with Accessibility Standards after the expiration or
termination of the Contract Term, unless HHSC or its clients or recipients, as applicable, use the Products in a
manner that renders it noncompliant.
(2)In the event CONTRACTOR becomes aware, or is notified that the Product or service and associated
documentation and technical support do not comply with the Accessibility Standards, CONTRACTOR represents
and warrants that it will, in a timely manner and at no cost to HHSC, perform all necessary steps to satisfy the
Accessibility Standards, including remediation, replacement, and upgrading of the Product or service, or providing
a suitable substitute.
(3)CONTRACTOR acknowledges and agrees that these representations and warranties are essential
inducements on which HHSC relies in awarding this Agreement.
(4)CONTRACTOR's representations and warranties under this subsection will survive the termination or
expiration of the Contract and will remain in full force and effect throughout the useful life of the Product.
(e) Remedies.
(1) Under Tex. Gov't Code§2054.465, neither CONTRACTOR nor any other person has cause of action
against HHSC for a claim of a failure to comply with Tex. Gov't Code Chapter 2054, Subchapter M, and rules of
the Department of Information Resources.
(2)In the event of a breach of CONTRACTOR's representations and warranties, CONTRACTOR will be
liable for direct, consequential, indirect, special, or liquidated damages and any other remedies to which HHSC
may be entitled under this Contract and other applicable law. This remedy is cumulative of any other remedies to
which HHSC may be entitled under this Contract and other applicable law.
Section 5.08 Prohibition Against Performance Outside the United States.
(a) Authority
(1) HHSC is responsible for administering several public programs that require the collection and maintenance of
information relating to persons who apply for and receive services from HHSC programs. This information consists of,
among other things, personal financial and medical information and information designated"Confidential Information"
. Some of this information may,within the limits of the law and this Agreement, be shared from time to time with
CONTRACTOR or a subcontractor for purposes of performing the Services or providing the Deliverables under this
Agreement.
(2)HHSC is also responsible for collecting and maintaining personal information, including personal financial and
medical information,concerning persons employed by HHSC and other health and human services agencies. Some
of this information may be shared from time to time with CONTRACTOR or a subcontractor or collected and
maintained by CONTRACTOR or a subcontractor for purposes of performing the Services or providing the
Deliverables under this Agreement.
(3) HHSC is legally responsible maintaining the confidentiality and integrity of information relating to applicants
and recipients of HHSC services and employees of HHS agencies and ensuring that any person or entity that
receives such information, including CONTRACTOR and any subcontractor, is similarly bound by these obligations.
(4) HHSC also is responsible for the development and implementation of computer software and hardware to
support HHSC programs.These items are paid for, in whole or in part,with state and federal funds. The federal
agencies that fund these items maintain a limited interest in the software and hardware so developed or acquired.
(5)Some of the software used or developed by HHSC may also be subject to statutory restrictions on the export
of technology to foreign nations, including but not limited to the Export Administration Regulations, 15 C.F.R. Parts
730-774.
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(b) Prohibition
(1) In view of these obligations, and to ensure accountability, integrity, and the security of the information
maintained by or for HHSC and the work performed on behalf of HHSC
HHSC DETERMINES THAT IT IS NECESSARY AND APPROPRIATE TO REQUIRE THAT:
(A) ALL WORK PERFORMED UNDER THIS AGREEMENT MUST BE PERFORMED
EXCLUSIVELY WITHIN THE UNITED STATES;AND
(B) ALL INFORMATION OBTAINED BY CONTRACTOR OR A SUBCONTRACTOR UNDER
THIS AGREEMENT MUST BE MAINTAINED WITHIN THE UNITED STATES.
(2) HHSC,without prior written approval, forbids the performance of any work or the maintenance of any
information relating or obtained pursuant to this Agreement to occur outside of the United States except as
specifically authorized or approved by HHSC.
(c) Meaning of"within the United States"and"outside the United States."
(1) As used in this Section 17.01,the term"within the United States" means any location inside the territorial
boundaries comprising the republic of the United States of America, including of any of the 48 coterminous states in
North America,the states of Alaska and Hawaii, and the District of Columbia.
(2) Conversely, the phrase"outside the United States"means any location that is not within the territorial
boundaries comprising the republic of the United States of America, including of any of the 48 coterminous states in
North America,the states of Alaska and Hawaii, and the District of Columbia.
(d) Maintenance of Confidential Information
(1) CONTRACTOR and all subcontractors, vendors, agents, and service providers of or for CONTRACTOR
must not allow any Confidential Information that CONTRACTOR receives from or on behalf of HHSC to leave the
United States by any means(physical or electronic)at any time, for any period of time, for any reason.
(2) CONTRACTOR and all subcontractors, vendors, agents, and service providers of or for CONTRACTOR
must not permit any person to have remote access to HHSC information, systems, or Deliverables from a location
outside the United States.
(e) Performance of Work under Agreement
(1) Unless otherwise approved in advance by HHSC in writing, and subject to the exceptions specified in
paragraph(e)of this Section 17.01, CONTRACTOR and all subcontractors, vendors, agents, and service providers of
or for CONTRACTOR must perform all services under this Agreement, including all tasks, functions, and
responsibilities assigned and delegated to CONTRACTOR under this Agreement, within the United States.
(A) This obligation includes all Services, including but not limited to information technology services, processing,
transmission,storage, archiving, data center services,disaster recovery sites and services, customer support,
medical,dental, laboratory and clinical services.
(B) All custom software prepared for performance of this Agreement, and all modifications of custom, third
party, or vendor proprietary software, must be performed within the United States.
(2) Unless otherwise approved in advance by HHSC in writing, and subject to the exceptions specified in this
Section, CONTRACTOR and all subcontractors, vendors, agents, and service providers of or for CONTRACTOR
must not permit any person to perform work under this Agreement from a location outside the United States.
(f) Exceptions
(1) COTS Software. The foregoing requirements will not preclude the acquisition or use of commercial off-the-
shelf(COTS)software that is developed outside the United States or hardware that is generically configured outside
the United States.
(2) Foreign-made Products and Supplies. The foregoing requirements will not preclude CONTRACTOR from
acquiring, using, or reimbursing products or supplies that are manufactured outside the United States, provided such
products or supplies are commercially available within the United States for acquisition or reimbursement by HHSC.
(3) HHSC Prior Approval. The foregoing requirements will not preclude CONTRACTOR from performing work
outside the United States that HHSC has approved in writing and that HHSC has confirmed will not involve the
sharing of Confidential Information outside the United States.
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(g) Disclosure
CONTRACTOR must disclose all Services and Deliverables under or related to this Agreement that
CONTRACTOR intends to perform or has performed outside the United States, whether directly or via
subcontractors,vendors, agents, or service providers.
(h) Remedy
(1) CONTRACTOR's violation of this Section will constitute a material breach of the Agreement.
CONTRACTOR will be liable to HHSC for all actual and consequential damages in accordance with the UTC.
(2) For breach of the requirements under this Section, HHSC may terminate the Agreement with Notice to
CONTRACTOR at least 1 calendar day before the effective date of such termination.
Article 6.Service Levels and Performance Measurement
Section 6.01 Performance measurement.
Satisfactory performance of the Agreement will be measured by:
(1)Adherence to the Agreement, including all representations and warranties;
(2)Compliance with project work plans, schedules, and milestones as proposed by CONTRACTOR in its
Proposal and as revised by CONTRACTOR and finally approved by HHSC;
(3) Delivery of the Services and Deliverables in accordance with the service levels and availability proposed in
Contractor's Proposal and as finally approved or accepted by HHSC;
(4) Results of audits performed by HHSC or its representatives in accordance with Article 8;
(5)Timeliness, completeness, and accuracy of required Deliverables; and
(6)Achievement of performance measures developed by CONTRACTOR and HHSC and as modified from time
to time by written agreement during the Initial Term of the Agreement.
Article 7.Amendments, Modifications,and Change Order Requests
Section 7.01 Amendments and modifications.
(a) Amendments and modifications resulting from changes in law or contract.
The Agreement may be amended by mutual written agreement of the Parties if changes in federal or state laws,
rules, regulations, policies,guidelines or circumstances affect the performance of the work.The Parties will develop a
business plan for negotiating appropriate change order and amendment procedures.
(b) Modifications resulting from imposition of remedies.
The Agreement may be modified under the terms of Article 11 (relating to Remedies and Disputes).
Section 7.02 Required compliance with amendment modification procedures.
No different or additional services,work, or products will be authorized or performed except those that are within
scope and that are memorialized in an amendment or modification of the Agreement that is executed in compliance
with this article. No waiver of any term, covenant, or condition of the Agreement will be valid unless executed in
compliance with this article. CONTRACTOR will not be entitled to payment for any services,work or products that are
not authorized by a properly executed Agreement amendment or modification, or through the express authorization of
HHSC.
Article 8.Audit and Financial Compliance
Section 8.01 Record retention and audit.
CONTRACTOR must maintain, and require its subcontractors to maintain, supporting information and
documents that are adequate to ensure that payments are made and paid in accordance with applicable Federal and
State requirements, and are sufficient to ensure the accuracy and validity of CONTRACTOR invoices. These
documents, including all original claims forms, will be maintained and retained by CONTRACTOR or its
subcontractors for a period of seven years after the date of submission of the final billing or until the resolution of all
litigation, claim, financial management review, or audit pertaining to the Agreement,whichever is longer.
CONTRACTOR agrees to timely repay any undisputed audit exceptions taken by HHSC in any audit of the
Agreement.
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Section 8.02 Access to records, books,and documents.
(a) Notice
Upon reasonable notice, CONTRACTOR must provide, and cause its subcontractors to provide, the officials and
entities identified in this Section with prompt, reasonable, and adequate access to any records, books, documents,
and papers that are directly pertinent to the performance of the Agreement.
(b) Access
CONTRACTOR and its subcontractors must provide the access described in this Section upon HHSC's request.
This request may include the following purposes:
(1) Examination;
(2)Audit;
(3)Investigation;
(4) Contract administration; or
(5)The making of copies, excerpts, or transcripts.
(c) Entities
The access required must be provided to the following officials or entities:
(1)The United States Department of Health and Human Services or its designee;
(2)The Comptroller General of the United States or its designee;
(3)Medicaid program personnel from HHSC or its designee;
(4)The Office of Investigations and Enforcement of HHSC;
(5)Any independent verification and validation contractor or quality assurance contractor, when acting on
behalf of HHSC;
(6)The Office of the State Auditor of Texas or its designee;
(7)A State or Federal law enforcement agency;
(8)A special or general investigating committee of the Texas Legislature or its designee; and
(9)Any other entity identified by HHSC.
(d) Accommodations
CONTRACTOR agrees to provide the access described wherever CONTRACTOR maintains the books, records,
and supporting documentation described above. CONTRACTOR further agrees to provide such access in reasonable
comfort and to provide any furnishings, equipment, or other conveniences deemed reasonably necessary to fulfill the
purposes described in this Section. CONTRACTOR will require its subcontractors to provide comparable access and
accommodations.
Upon request, CONTRACTOR must provide copies of the information described in this Section free of charge to
HHSC and the entities described in subsection(c).
Section 8.03 Audits and inspections of Services and Deliverables.
Upon notice from HHSC where possible, CONTRACTOR will provide, and will cause its subcontractors to
provide, such auditors and inspectors as HHSC may from time to time designate,with access to:
(1)CONTRACTOR service locations, facilities, or installations;
(2)CONTRACTOR Software and Equipment; and
(3)CONTRACTOR records.
CONTRACTOR must provide as part of the Services any assistance that such auditors and inspectors
reasonably may require to complete such audits or inspections.
Section 8.04 Response/compliance with audit or inspection findings.
(a)CONTRACTOR must take action to ensure its or a subcontractor's compliance with a correction of any
finding of noncompliance with any law, regulation, audit requirement, or generally accepted accounting principle
relating to the Services and Deliverables or any other deficiency contained in any audit, review, or inspection
conducted under the Agreement.This action will include CONTRACTOR'S delivery to HHSC, for HHSC'S approval, a
Corrective Action Plan that addresses deficiencies identified in any audit(s), review(s), or inspection(s)within thirty
(30)calendar days of the close of the audit(s), review(s), or inspection(s).
(b)CONTRACTOR must bear the expense of compliance with any finding of noncompliance under the
Agreement that is:
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(1) Required by a Texas or Federal law, regulation, rule or other audit requirement relating to
CONTRACTOR's business;
(2) Performed by CONTRACTOR as part of the Services and Deliverables; or
(3)Necessary due to CONTRACTOR's noncompliance with any law, regulation, rule or audit requirement
imposed on CONTRACTOR.
(c)As part of the Services, CONTRACTOR must provide to HHSC upon request a copy of those portions of
CONTRACTOR's and its subcontractors' internal audit reports relating to the Services and Deliverables provided to
the State under the Agreement.
Section 8.05 Audit of CONTRACTOR fees.
(a)CONTRACTOR will provide, and will cause its subcontractors to provide, to HHSC and its designees access
to financial records and supporting documentation reasonably requested by HHSC.
(b) In addition to the normal monthly review and payment of administrative vouchers, HHSC may audit the Fees
charged to HHSC to determine whether such Fees are accurate and in accordance with the Agreement.
(c) If, as a result of such audit, HHSC determines that CONTRACTOR has overcharged the State, HHSC will
notify CONTRACTOR of the amount of such overcharge and CONTRACTOR will promptly pay to HHSC the amount
of the overcharge, plus interest. Interest on such overpayment amount will be calculated from the date of receipt by
the CONTRACTOR of the overcharged amount until the date of payment to HHSC, and will be calculated at the
Department of Treasury's Median Rate(resulting from the Treasury's auction of 13-week bills)for the week in which
liability is assessed, but in no event to exceed the highest lawful rate of interest. In the event any such audit reveals
an overcharge to HHSC, CONTRACTOR will reimburse HHSC for the cost of such audit.
Section 8.06 SAO Audit.
The CONTRACTOR understands that acceptance of funds under this Contract acts as acceptance of the
authority of the State Auditor's Office(SAO), or any successor agency, to conduct an investigation in connection with
those funds.The CONTRACTOR further agrees to cooperate fully with the SAO or its successor in the conduct of the
audit or investigation, including providing all records requested. The CONTRACTOR will ensure that this clause
concerning the authority to audit funds received indirectly by subcontractors through CONTRACTOR and the
requirement to cooperate is included in any subcontract it awards.
Article 9.Terms and Conditions of Payment
Section 9.01 Rights of set-off.
(a) General right of set-off.
With respect to any undisputed amount that a Party in good faith determines should be reimbursed to it or is
otherwise payable to it by the other Party under the Agreement,the Party seeking the set-off may deduct the entire
amount owed against the charges otherwise payable or expenses owed to it under the Agreement until such time as
the entire amount determined to be owed has been paid.
(b) Duty to make payments.
HHSC will be relieved of its obligation to make any payments to the CONTRACTOR until such time as all set-off
amounts have been credited to HHSC and the CONTRACTOR will be relieved of its obligation to make any payments
to HHSC until such time as such amounts have been credited to the CONTRACTOR.
Section 9.02 Expenses.
Except as provided in the Agreement, all other expenses incurred by the CONTRACTOR in connection with its
provision of the Services or Deliverables will not be reimbursed by HHSC unless agreed to by HHSC.
CONTRACTOR will be responsible for payment of all expenses related to salaries, benefits,employment taxes, and
insurance for its Staff. In addition,the costs associated with transportation, delivery, and insurance for each
Deliverable will be paid by CONTRACTOR.
Section 9.03 Disputed fees.
If HHSC disputes payment of all or any portion of an invoice from the CONTRACTOR, HHSC will notify the
CONTRACTOR of the dispute and both Parties will attempt in good faith to resolve the dispute. HHSC will not be
required to pay any disputed portion of a CONTRACTOR invoice unless and until the dispute is resolved.
Notwithstanding any such dispute,the CONTRACTOR must continue to perform the Services and produce
Deliverables in compliance with the terms of the Agreement pending resolution of such dispute so long as all
undisputed amounts continue to be paid to CONTRACTOR.
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Section 9.04 Liability for taxes.
HHSC is not responsible in any way for the payment of any federal, state or local taxes related to or incurred in
connection with the CONTRACTOR'S performance of the Agreement. CONTRACTOR must pay and discharge any
and all such taxes, including any penalties and interest. In addition, HHSC is exempt from Federal excise taxes, and
will not pay for any personal property taxes or income taxes levied on CONTRACTOR or on any taxes levied on
employee wages.
Section 9.05 Liability for employment-related charges and benefits.
CONTRACTOR will perform work under the Agreement as an independent contractor and not as agent or
representative of HHSC. CONTRACTOR is solely and exclusively liable for all taxes and employment-related charges
incurred in connection with the performance of the Agreement. HHSC will not be liable for any employment-related
charges or benefits of CONTRACTOR, such as workers compensation benefits, unemployment insurance and
benefits, or fringe benefits.
Section 9.06 No additional consideration.
CONTRACTOR will not be entitled to nor receive from HHSC any additional consideration, compensation,
salary,wages, or any other type of remuneration for services rendered under the Agreement. CONTRACTOR will not
be entitled by virtue of the Agreement to consideration in the form of overtime, health insurance benefits, retirement
benefits, disability retirement benefits, sick leave, vacation time, paid holidays, or other paid leaves of absence of any
type or kind whatsoever. In addition,the costs associated with transportation, delivery, and insurance relating to the
CONTRACTOR'S performance of the Agreement will be paid for by the CONTRACTOR.
Section 9.07 No increase in rates.
CONTRACTOR will not increase rates during the term of the Agreement, except as authorized in Article 7.
Article 10. Disclosure and Confidentiality of Information
Section 10.01 Confidentiality.
(a) HHSC Data Use Agreement
The HHSC Data Use Agreement,Attachment A to these UTCs, is incorporated into the Agreement and
describes CONTRACTOR's rights and obligations with respect to the Confidential Information and the limited
purposes for which the CONTRACTOR may create, receive, maintain, use, disclose or have access to Confidential
Information.
Section 10.02 Requests for public information.
(a) HHSC agrees that it will promptly notify CONTRACTOR of a request for disclosure of public information filed
in accordance with the Texas Public Information Act, Texas Government Code Chapter 552,which consists of the
CONTRACTOR's Confidential Information, including information to which CONTRACTOR believes it has a
proprietary or commercial interest. HHSC will deliver a copy of the request for public information to CONTRACTOR.
(b)With respect to any information that is the subject of a request for disclosure, CONTRACTOR is required to
demonstrate to the Texas Office of Attorney General the specific reasons why the requested information is
confidential or otherwise excepted from required public disclosure under law. CONTRACTOR will provide HHSC with
copies of all such communications.
(c)CONTRACTOR must make information defined as public information not otherwise excepted from disclosure
under the Texas Public Information Act, Texas Government Code Chapter 552, available to HHSC in a format
agreeable to HHSC, accessible by the public, and at no additional charge to HHSC.
(d)To the extent authorized under the Texas Public Information Act, HHSC agrees to safeguard from disclosure
information received from CONTRACTOR that the CONTRACTOR believes to be Confidential Information.
CONTRACTOR must clearly mark such information as Confidential Information or provide written notice to HHSC
that it considers the information confidential.
(e)To the extent allowed under the Texas Public Information Act, Texas Government Code Chapter 552,
CONTRACTOR agrees that any consultant reports received by HHSC in connection with the Agreement, may be
distributed by HHSC, in its discretion,to any other state agency and the Texas legislature. Any distribution may
include posting on HHSC's website or the website of a standing committee of the legislature.
Section 10.03 Privileged Work Product.
(a)CONTRACTOR acknowledges that HHSC asserts that Privileged Work Product may be prepared in
anticipation of litigation and that CONTRACTOR is performing the Services with respect to Privileged Work Product
as an agent of HHSC, and that all matter related thereto is protected from disclosure by the Texas Rules of Civil
Procedure,Texas Rules of Evidence, Federal Rules of Civil Procedure, or Federal Rules of Evidence.
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(b) HHSC will notify CONTRACTOR of any Privileged Work Product to which CONTRACTOR has or may have
access.After the CONTRACTOR is notified or otherwise becomes aware that such documents, data, database, or
communications are Privileged Work Product, only CONTRACTOR personnel for whom such access is necessary for
the purposes of providing the Services may have access to Privileged Work Product.
(c) If CONTRACTOR receives notice of any judicial or other proceeding seeking to obtain access to HHSC's
Privileged Work Product, CONTRACTOR will:
(1)Immediately notify HHSC; and
(2) Use all reasonable efforts to resist providing such access.
(d) If CONTRACTOR resists disclosure of HHSC's Privileged Work Product in accordance with this Section,
HHSC will,to the extent authorized under Civil Practices and Remedies Code or other applicable State law, have the
right and duty(i)to represent CONTRACTOR in such resistance; (ii)to retain counsel to so represent
CONTRACTOR; or(iii)to reimburse CONTRACTOR for reasonable attorneys'fees and expenses incurred in
resisting such access. HHSC will make the sole determination as to which of the preceding duties it will undertake.
(e)If a court of competent jurisdiction orders CONTRACTOR to produce documents, disclose data, or otherwise
breach Contractor's confidentiality obligations or maintenance obligations regarding the confidentiality, proprietary
nature, and secrecy of Privileged Work Product, CONTRACTOR will not be liable for breach of such obligation.
Section 10.04 Unauthorized acts.
Each Party agrees to:
(1) Notify the other Party promptly of any unauthorized possession, use, or knowledge, or attempt thereof, of any
of the other Party's Confidential Information by any person or entity that may become known to it;
(2) Promptly furnish to the other Party full details of the unauthorized possession, use, or knowledge, or attempt
thereof, and use reasonable efforts to assist the other Party in investigating or preventing the reoccurrence of any
unauthorized possession, use, or knowledge, or attempt thereof, of Confidential Information;
(3)Cooperate with the other Party in any litigation and investigation against third Parties deemed necessary by
such Party to protect its proprietary rights; and
(4) Promptly prevent a reoccurrence of any such unauthorized possession, use, or knowledge of Confidential
Information.
Section 10.05 Legal action.
A party may not commence any legal action or proceeding with a third party with respect to any unauthorized
possession, use, or knowledge, or attempt thereof, of the other Party's Confidential Information by any person or
entity, if that action or proceeding identifies the other Party or its Confidential Information without such Party's
consent.
Article 11. Remedies and Disputes
Section 11.01 Understanding and expectations.
The remedies described in this Article are directed to CONTRACTOR's timely and responsive performance of
the Services and Deliverables, and to the creation of a flexible and responsive relationship between the Parties.
Section 11.02 Tailored remedies.
(a) Understanding of the Parties.
CONTRACTOR agrees and understands that HHSC may pursue tailored contractual remedies for
noncompliance with the Agreement.At any time and at its discretion, HHSC may impose or pursue one or more
remedies for each item of noncompliance and will determine remedies on a case-by-case basis. HHSC's pursuit or
non-pursuit of a tailored remedy does not constitute a waiver of any other remedy that HHSC may have at law or
equity.
(b) Notice and opportunity to cure for non-material breach.
(1)HHSC will notify CONTRACTOR in writing of specific areas of CONTRACTOR performance that fail to meet
performance expectations, standards, or schedules, but that, in the determination of HHSC, do not result in a material
deficiency or delay in the implementation or operation of the Services.
(2)CONTRACTOR will,within three business days(or another date approved by HHSC)of receipt of written
notice of a non-material deficiency, provide HHSC a written response that:
(A) Explains the reasons for the deficiency, CONTRACTOR's plan to address or cure the deficiency, and
the date and time by which the deficiency will be cured; or
(B)If CONTRACTOR disagrees with HHSC's findings, explains its reasons for disagreeing with HHSC's
findings.
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(3)CONTRACTOR's proposed cure of a non-material deficiency is subject to the approval of HHSC.
CONTRACTOR's repeated commission of non-material deficiencies or repeated failure to resolve any such
deficiencies may be regarded by HHSC as a material deficiency and entitle HHSC to pursue any other remedy
provided in the Agreement or any other appropriate remedy HHSC may have at law or equity.
(c) Corrective action plan.
(1)At its option, HHSC may require CONTRACTOR to submit to HHSC a detailed written plan(the"Corrective
Action Plan")to correct or resolve a material deficiency or breach of the Agreement.
(2)The Corrective Action Plan must provide:
(A)A detailed explanation of the reasons for the cited deficiency;
(B)CONTRACTOR's assessment or diagnosis of the cause;
(C)A specific proposal to cure or resolve the deficiency; and
(D)CONTRACTOR's timeline for cure or resolution of the deficiency
(3)The Corrective Action Plan must be submitted by the deadline set forth in HHSC's request for a Corrective
Action Plan. The Corrective Action Plan is subject to approval by HHSC,which will not be withheld unreasonably.
(4)HHSC will notify CONTRACTOR in writing of HHSC's final disposition of HHSC's concerns regarding the
Corrective Action Plan. If HHSC accepts CONTRACTOR's proposed Corrective Action Plan, HHSC may:
(A) Condition such approval on completion of tasks in the order or priority that HHSC may prescribe;
(B) Disapprove portions of CONTRACTOR's proposed Corrective Action Plan; or
(C) Require additional or different corrective action(s).
(5)At any time during this remedial process, HHSC reserves the right to:
(A)Suspend all, or part of,the Agreement, and to withhold further payment for the suspended portions
of the Agreement; or
(B) Prohibit CONTRACTOR from incurring additional obligations of funds during investigation of the
pending corrective action, if necessary, by CONTRACTOR or a decision by HHSC to terminate the
Agreement for cause.
(6) If HHSC rejects CONTRACTOR's written explanation or proposed Corrective Action Plan, HHSC may issue a
Stop Work Order to CONTRACTOR or any of its subcontractors or suppliers. HHSC may delay the implementation of
the Stop Work Order if it affects the completion of any of the Services in accordance with the approved schedule or
work plan.
(7)HHSC's acceptance of a Corrective Action Plan under this Section will not:
(A) Excuse CONTRACTOR's prior substandard performance;
(B) Relieve CONTRACTOR of its duty to comply with performance standards; or
(C) Prohibit HHSC from assessing additional tailored remedies or pursuing other appropriate remedies
for continued substandard performance.
(d) Administrative remedies.
(1)At its discretion, HHSC may impose one or more of the following remedies for each item of noncompliance
and will determine the scope and severity of the remedy on a case-by-case basis:
(A)Assess liquidated damages in accordance with the terms of the Agreement if provided in the
Agreement;
(B)Conduct accelerated monitoring of the CONTRACTOR.Accelerated monitoring includes more
frequent or more extensive monitoring by HHSC or its agent;
(C) Require additional, more detailed, financial or programmatic reports to be submitted by
CONTRACTOR;
(D) Decline to renew or extend the Agreement;
(E)Withhold or recoup payment for the noncompliant Service or Deliverable; or
(F)Terminate the Agreement in accordance with Section 11.03.
(2)For purposes of the Agreement, an item of noncompliance means a specific action of CONTRACTOR that:
(A)Violates a provision of the Agreement;
(B) Fails to meet an agreed measure of performance; or
(C) Represents a failure of CONTRACTOR to be reasonably responsive to a reasonable request of
HHSC relating to the Services and Deliverables for information, assistance, or support within the timeframe
specified by HHSC.
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(3)HHSC will provide notice to CONTRACTOR of the imposition of an administrative remedy in accordance with
this Section, with the exception of accelerated monitoring, which may be unannounced. HHSC may require
CONTRACTOR to file a written response as part of the Tailored Remedy approach.
(4)The Parties agree that a State or Federal statute, rule, regulation, or Federal guideline will prevail over the
provisions of this Section unless the statute, rule, regulation, or guidelines can be read together with this Section to
give effect to both.
(e) Damages.
(1) HHSC will be entitled to actual and consequential damages resulting from the CONTRACTOR's failure to
comply with any of the terms of the Agreement.
(2)In some cases,the actual damage to HHSC or the State of Texas as a result of CONTRACTOR's failure to
meet any aspect of the responsibilities of the Agreement or to meet specific performance standards set forth in the
Agreement are difficult or impossible to determine with precise accuracy.Therefore, liquidated damages may be
assessed in writing against and paid by the CONTRACTOR for failure to meet any aspect of the responsibilities of the
Agreement or to meet the specific performance standards identified by the HHSC. Liquidated damages may be
assessed if HHSC determines such failure is the fault of the CONTRACTOR(including the CONTRACTOR's
subcontractors or consultants)and is not materially caused or contributed to by HHSC or its agents. If at any time,
HHSC determines the CONTRACTOR has not met any aspect of the responsibilities of the Agreement or the specific
performance standards due to mitigating circumstances, HHSC reserves the right to waive all or part of the liquidated
damages.All such waivers must be in writing, contain the reasons for the waiver, and be signed by the appropriate
executive of HHSC.
(a)The liquidated damages prescribed in this Section are not intended to be in the nature of a penalty, but are
intended to be reasonable estimates of HHSC's projected financial loss and damage resulting from the
CONTRACTOR's nonperformance, including financial loss as a result of project delays.Accordingly, in the event
CONTRACTOR fails to perform in accordance with the Agreement, HHSC may assess liquidated damages as
provided in this Section.
(3)If CONTRACTOR fails to perform any of the Services described in the Agreement, HHSC may assess
liquidated damages for each occurrence of a liquidated damages event,to the extent consistent with HHSC's tailored
approach to remedies and Texas law.
(4) HHSC may elect to collect liquidated damages:
(A)Through direct assessment and demand for payment delivered to CONTRACTOR; or
(B) By deduction of amounts assessed as liquidated damages as set-off against payments then due to
CONTRACTOR for the Services or Deliverables or that become due at any time after assessment of the
liquidated damages. HHSC will make deductions until the full amount payable by the CONTRACTOR is
received by the State.
(f) Equitable Remedies
(1)CONTRACTOR acknowledges that, if CONTRACTOR breaches(or attempts or threatens to breach)its
obligation under the Agreement,the State will be irreparably harmed. In such a circumstance, HHSC may proceed
directly to court.
(2) If a court of competent jurisdiction finds that CONTRACTOR breached (or attempted or threatened to breach)
any such obligations, CONTRACTOR agrees that without any additional findings of irreparable injury or other
conditions to injunctive relief, it will not oppose the entry of an appropriate order compelling performance by
CONTRACTOR and restraining it from any further breaches(or attempted or threatened breaches).
(g) Suspension of Agreement
(1)HHSC may suspend performance of all or any part of the Agreement if:
(A)HHSC determines that CONTRACTOR has committed a material breach of the Agreement;
(B) HHSC has reason to believe that CONTRACTOR has committed, assisted in the commission of, or
failed to take appropriate action concerning fraud, abuse, malfeasance, misfeasance, or nonfeasance by
any party concerning the Agreement; or
(C) HHSC determines that suspension of the Agreement in whole or in part is convenient or in the best
interests of the State of Texas or the HHSC Programs.
(2)HHSC will notify CONTRACTOR in writing of its intention to suspend the Agreement in whole or in part. Such
notice will:
(A) Be delivered in writing to CONTRACTOR;
(B) Include a concise description of the facts or matter leading to HHSC's decision; and
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(C) Unless HHSC is suspending the contract for convenience, request a Corrective Action Plan from
CONTRACTOR or describe actions that CONTRACTOR must take to avoid the contemplated suspension of
the Agreement.
Section 11.03 Termination of Agreement.
In addition to other provisions of this article allowing termination, the Agreement will terminate upon the
expiration date unless extended in accordance with the terms of the Agreement, or terminated sooner under the
terms of the Agreement. Prior to completion of the Initial Term and any extensions or renewal thereof, all or a part of
the Agreement may be terminated for any of the following reasons:
(a) Termination by mutual agreement of the Parties.
The Agreement may be terminated by mutual agreement of the Parties. Such agreement must be in writing.
(b) Termination in the best interest of the State.
HHSC may terminate the Agreement at any time when, in its sole discretion, HHSC determines that termination
is in the best interests of the State of Texas.The termination will be effective on the date specified in HHSC's notice
of termination.
(c) Termination for cause.
Except as otherwise provided by the U.S. Bankruptcy Code, or any successor law, HHSC may terminate the
Agreement, in whole or in part, upon the following conditions:
(1)Assignment for the benefit of all or substantially all of its creditors, appointment of receiver, or inability to
pay debts.
HHSC may terminate the Agreement if CONTRACTOR:
(A) Makes an assignment for the benefit of its creditors;
(B)Admits in writing its inability to pay its debts generally as they become due; or
(C)Consents to the appointment of a receiver,trustee, or liquidator of CONTRACTOR or of all or any
part of its property.
(2)Failure to adhere to laws, rules, ordinances, or orders.
HHSC may terminate the Agreement if a court of competent jurisdiction finds CONTRACTOR failed to
adhere to any laws, ordinances, rules, regulations or orders of any public authority having jurisdiction and such
violation prevents or substantially impairs performance of CONTRACTOR's duties under the Agreement.
(3)Breach of confidentiality.
HHSC may terminate the Agreement if CONTRACTOR breaches confidentiality obligations with respect to
the Services and Deliverables provided under the Agreement.
(4)Failure to maintain adequate personnel or resources.
HHSC may terminate the Agreement if, after providing notice and an opportunity to correct, HHSC
determines that CONTRACTOR has failed to supply personnel or resources and such failure results in
CONTRACTOR's inability to fulfill its duties under the Agreement.
(5) Termination for gifts and gratuities.
(A)HHSC may terminate the Agreement following the determination by a competent judicial or quasi-
judicial authority and CONTRACTOR's exhaustion of all legal remedies that CONTRACTOR, its employees,
agents or representatives have either offered or given anything of value to an officer or employee of HHSC
or the State of Texas in violation of state law.
(B)CONTRACTOR must include a similar provision in each of its subcontracts and will enforce this
provision against a subcontractor who has offered or given anything of value to any of the persons or entities
described in this Section, whether or not the offer or gift was in CONTRACTOR's behalf.
(C)Termination of a subcontract by CONTRACTOR under this provision will not be a cause for
termination of the Agreement unless:
(1)CONTRACTOR fails to replace such terminated subcontractor within a reasonable time.
(D) For purposes of this Section, a"thing of value"means any item of tangible or intangible property that
has a monetary value of more than$50.00 and includes, but is not limited to, cash, food, lodging,
entertainment, and charitable contributions. The term does not include contributions to holders of public
office or candidates for public office that are paid and reported in accordance with State or Federal law.
(6) Termination for non-appropriation of funds.
Notwithstanding any other provision of the Agreement, if funds for the continued fulfillment of the
Agreement by HHSC are at any time not forthcoming or are insufficient,through failure of any entity to
appropriate funds or otherwise,then HHSC will have the right to terminate the Agreement at no additional
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cost and with no penalty whatsoever. HHSC will make best efforts to provide reasonable written advance
notice to CONTRACTOR upon learning that funding for the Agreement may be discontinued.
(7) Termination for lack of financial viability.
HHSC may terminate the Agreement if, in its sole discretion, HHSC has a good faith belief that
CONTRACTOR no longer maintains the financial viability required to complete the Services and
Deliverables, or otherwise fully perform the Agreement.
(8)Judgment and execution.
(A) HHSC may terminate the Agreement if judgment for the payment of money in excess of$500,000.00
that is not covered by insurance, is rendered by any court or governmental body against CONTRACTOR, and
CONTRACTOR does not:
(1) Discharge the judgment or provide for its discharge in accordance with the terms of the judgment;
(2) Procure a stay of execution of the judgment within 30 days from the date of entry thereof; or
(3) Perfect an appeal of such judgment and cause the execution of such judgment to be stayed during
the appeal, providing such financial reserves as may be required under generally accepted accounting
principles.
(B)If a writ or warrant of attachment or any similar process is issued by any court against all or any material
portion of the property of CONTRACTOR, and such writ or warrant of attachment or any similar process is not
released or bonded within 30 days after its entry, HHSC may terminate the Agreement in accordance with this
Section.
(8) Termination for CONTRACTOR's material breach of the Agreement.
HHSC will have the right to terminate the Agreement in whole or in part if HHSC determines, at its sole
discretion,that CONTRACTOR has materially breached the Agreement.
Section 11.04 Effective date of termination.
Except as otherwise provided in the Agreement, termination will be effective as of the date specified in the notice
of termination.
Section 11.05 Extension of termination effective date.
HHSC may extend the effective date of termination one or more times as it elects, in its sole discretion.
Section 11.06 Payment and other provisions at Agreement termination.
(a) If HHSC terminates the Agreement, HHSC will pay CONTRACTOR on the effective date of termination(or as
soon as possible thereafter taking into account appropriation and fund accounting requirements)any undisputed
amounts due for all completed, approved, and accepted Services or Deliverables.
(b) HHSC further agrees to negotiate in good faith with CONTRACTOR to equitably adjust and settle any
accrued or outstanding liabilities for any unaccepted Service or deliverable and Change Order Requests that
(1) Is due or delivered prior to or upon contract termination;
(2) Is complete or substantially complete, or for which CONTRACTOR can document to the satisfaction of
HHSC substantial progress; and
(3) Benefits HHSC or the State of Texas, notwithstanding its unaccepted status.
(c)CONTRACTOR must provide HHSC all reasonable access to records, facilities, and documentation as is
required to efficiently and expeditiously close out the Services under the Agreement.
(d)CONTRACTOR must prepare a turnover plan,which is acceptable to and approved by HHSC.That turnover
plan will be implemented during the time period between receipt of notice and the termination date.
Section 11.07 Modification of Agreement in the event of remedies.
HHSC may propose a modification of the Agreement in response to the imposition of a remedy under this
article.Any modifications under this Section must be reasonable, limited to the matters causing the exercise of a
remedy, within the scope of the Agreement, and in writing. CONTRACTOR must negotiate such proposed
modifications in good faith.
Section 11.08 Turnover assistance.
Upon receipt of notice of termination of the Agreement by HHSC, CONTRACTOR will provide any turnover
assistance reasonably necessary to enable HHSC or its designee to effectively close out the Agreement and move
the work to another vendor or to perform the work by itself.
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Section 11.09 Rights upon termination or expiration of Agreement.
In the event that the Agreement is terminated for any reason, or upon its expiration, HHSC will, at HHSC's
discretion, retain ownership of any and all associated work products, Deliverables or Documentation in whatever form
that they exist.
Section 11.10 CONTRACTOR responsibility for associated costs.
If HHSC terminates the Agreement for Cause, the CONTRACTOR will be responsible to HHSC for all costs
incurred by HHSC,the State of Texas, or any of its administrative agencies to replace the CONTRACTOR. These
costs include, but are not limited to, the costs of procuring a substitute vendor and the cost of any claim or litigation
that is reasonably attributable to CONTRACTOR's failure to perform any Service in accordance with the terms of the
Agreement
Section 11.11 Dispute resolution.
(a) General agreement of the Parties.
The Parties mutually agree that the interests of fairness, efficiency, and good business practices are best served
when the Parties employ all reasonable and informal means to resolve any dispute under the Agreement. The Parties
mutually commit to using all reasonable and informal means of resolving disputes prior to invoking a remedy provided
elsewhere in this Article, unless HHSC immediately terminates the Agreement in accordance with the terms and
conditions of the Agreement.
(b) Duty to negotiate in good faith.
Any dispute that in the judgment of any Party to the Agreement may materially or substantially affect the
performance of any Party will be reduced to writing and delivered to the other Party within 10 business days. The
Parties must then negotiate in good faith and use every reasonable effort to resolve the dispute and the Parties will
not resort to any formal proceedings unless they have reasonably determined that a negotiated resolution is not
possible and notified the other Party. The resolution of any dispute disposed of by agreement between the Parties will
be reduced to writing and delivered to all Parties within 10 business days.
(c) Claims for breach of Agreement.
(1) General requirement. As required by Chapter 2260, Government Code, CONTRACTOR's claim for breach
of the Agreement must resolved in accordance with the dispute resolution process established by HHSC in
accordance with Chapter 2260, Government Code.
(2) Negotiation of claims. The Parties agree that the CONTRACTOR's claim for breach of the Agreement that
the Parties cannot resolve in the ordinary course of business or through the use of all reasonable and informal means
will be submitted to the negotiation process provided in Chapter 2260, Subchapter B, Government Code.
(A)To initiate the process, CONTRACTOR must submit written notice to HHSC that states that
CONTRACTOR invokes the provisions of Chapter 2260, Subchapter B, Government Code. The notice must
comply with the requirements of Title 1, Chapter 392, Subchapter B of the Texas Administrative Code.
(B)The Parties agree that the CONTRACTOR's compliance with Chapter 2260, Subchapter B, Government
Code,will be a condition precedent to the filing of a contested case proceeding under Chapter 2260, Subchapter
C, of the Government Code.
(3) Contested case proceedings. The contested case process provided in Chapter 2260, Subchapter C,
Government Code, will be CONTRACTOR's sole and exclusive process for seeking a remedy for any and all alleged
breaches of contract by HHSC if the Parties are unable to resolve their disputes under Subsection (c)(2)of this
Section.
(A)The Parties agree that compliance with the contested case process provided in Chapter 2260,
Subchapter C, Government Code,will be a condition precedent to seeking consent to sue from the Texas
Legislature under Chapter 107, Civil Practices&Remedies Code. Neither the execution of the Agreement by
HHSC nor any other conduct of any representative of HHSC relating to the Agreement will be considered a
waiver of the State's sovereign immunity to suit.
(4) HHSC rules. The submission, processing and resolution of CONTRACTOR's claim is governed by the rules
adopted by HHSC under Chapter 2260, Government Code, found at Title 1, Chapter 392, Subchapter B of the Texas
Administrative Code.
(5) CONTRACTOR's duty to perform. Neither the occurrence of an event constituting an alleged breach of
contract nor the pending status of any claim for breach of contract is grounds for the suspension of performance, in
whole or in part, by CONTRACTOR of any duty or obligation with respect to the performance of the Agreement.Any
changes to the Agreement as a result of a Dispute Resolution will be implemented in accordance with Article 8,
Amendments, Modifications and Change Order Requests.
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Section 11.12 Liability of CONTRACTOR.
(a)CONTRACTOR bears all risk of loss or damage due to:
(1) Defects in products, Services or Deliverables;
(2)Unfitness or obsolescence of products, Services or Deliverables; or
(3)The negligence or intentional misconduct of CONTRACTOR or its employees, agents, subcontractors, or
representatives.
(b)CONTRACTOR MUST,AT THE CONTRACTOR'S OWN EXPENSE, DEFEND WITH COUNSEL
APPROVED BY THE STATE, INDEMNIFY,AND HOLD HARMLESS THE STATE AND STATE EMPLOYEES,
OFFICERS, DIRECTORS,CONTRACTORS AND AGENTS FROM AND AGAINST ANY LOSSES, LIABILITIES,
DAMAGES, PENALTIES,COSTS,FEES, INCLUDING WITHOUT LIMITATION REASONABLE ATTORNEYS'
FEES,AND EXPENSES FROM ANY CLAIM OR ACTION FOR PROPERTY DAMAGE, BODILY INJURY OR
DEATH,TO THE EXTENT CAUSED BY OR ARISING FROM THE NEGLIGENCE OR INTENTIONAL
MISCONDUCT OF THE CONTRACTOR AND ITS EMPLOYEES,OFFICERS,AGENTS, OR SUBCONTRACTORS.
(c)CONTRACTOR will not be liable to HHSC for any loss, damages or liabilities attributable to or arising from:
(1)The failure of HHSC or any state agency or HHSC CONTRACTOR to perform a service or activity in
connection with the Agreement; or
(2)CONTRACTOR's prudent and diligent performance of the Services in compliance with instructions given
by HHSC in accordance with Section 1.03(relating to implied authority)and Section 3.03(relating to delegation
of authority)of the Agreement.
(d) CONTRACTOR will ship all Equipment and Software purchased and Third Party Software licensed under the
Agreement,freight prepaid, FOB HHSC's destination. The method of shipment will be consistent with the nature of
the Equipment and Software and hazards of transportation. Regardless of FOB point, CONTRACTOR agrees to bear
all risks of loss, damage, or destruction of Deliverables, in whole or in part, ordered hereunder that occurs prior to
Acceptance, except loss or damage attributable to HHSC's fault or negligence; and such loss, damage, or destruction
will not release CONTRACTOR from any obligation hereunder.After Acceptance,the risk of loss or damage will be
borne by HHSC, except loss or damage attributable to CONTRACTOR's fault or negligence.
Article 12.Assurances and Certifications
Section 12.01 Proposal certifications.
CONTRACTOR acknowledges its continuing obligation to comply with the requirements of any certifications
contained in the Agreement, and will immediately notify HHSC of any changes in circumstances affecting those
certifications.
Section 12.02 Conflicts of interest.
(a) Representation.
CONTRACTOR agrees to comply with applicable state and federal laws, rules, and regulations regarding
conflicts of interest in the performance of its duties under the Agreement. CONTRACTOR warrants that it, its
subcontractors, and employees, officers,directors and agents of Contractor and Contractor's subcontractors have no
interest and will not acquire any direct or indirect interest that would conflict in any manner or degree with its
performance under the Agreement.
(b) General duty regarding conflicts of interest.
CONTRACTOR will establish safeguards to prohibit employees from using their positions for a purpose that
constitutes or presents the appearance of personal or organizational conflict of interest, or personal gain.
CONTRACTOR will operate with complete independence and objectivity without actual, potential or apparent conflict
of interest with respect to the activities conducted under the Agreement with the State of Texas.
Section 12.03 Organizational conflicts of interest.
(a) Definition.
An organizational conflict of interest is a set of facts or circumstances, a relationship, or other situation under
which a contractor, or a subcontractor has past, present, or currently planned personal or financial activities or
interests that either directly or indirectly:
(1)Impairs or diminishes the offeror's, contractor's, or subcontractor's ability to render impartial or objective
assistance or advice to HHSC; or
(2)Provides the contractor or subcontractor an unfair competitive advantage in future HHSC procurements.
(b) Warranty.
Except as otherwise disclosed and approved by HHSC prior to the Effective Date of the Contract,
CONTRACTOR warrants that, as of the Effective Date and to the best of its knowledge and belief, there are no
relevant facts or circumstances that could give rise to organizational conflict of interest affecting the Agreement.
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CONTRACTOR affirms that it has neither given, nor intends to give, at any time hereafter, any economic opportunity,
future employment, gift, loan, gratuity, special discount,trip, favor, or service to a public servant or any employee or
representative of same, at any time during the procurement process or in connection with the procurement process
except as allowed under relevant state and federal law.
(c) Continuing duty to disclose.
(1)CONTRACTOR agrees that, if after the Effective Date, CONTRACTOR discovers is made aware of an
organizational conflict of interest, CONTRACTOR will immediately and fully disclose such interest in writing to
the HHSC project manager. In addition, CONTRACTOR must promptly disclose any relationship that might be
perceived or represented as a conflict after its discovery by CONTRACTOR or by HHSC as a potential conflict.
HHSC reserves the right to make a final determination regarding the existence of conflicts of interest, and
CONTRACTOR agrees to abide by HHSC's decision.
(2)The disclosure will include a description of the action(s)that CONTRACTOR has taken or proposes to
take to avoid or mitigate such conflicts.
(d) Remedy.
If HHSC determines that an organizational conflict of interest exists, HHSC may, at its discretion,terminate the
contract. If HHSC determines that CONTRACTOR was aware of an organizational conflict of interest before the
award of the Agreement and did not disclose the conflict to the contracting officer, such nondisclosure will be
considered a material breach of the Agreement. Furthermore, such breach may be submitted to the Office of the
Attorney General, Texas Ethics Commission, or appropriate State or Federal law enforcement officials for further
action.
(e) Flow down obligation.
CONTRACTOR must include the provisions of this Section 12.03 in all subcontracts for work to be performed
similar to the service provided by CONTRACTOR, and the terms"Agreement,""CONTRACTOR,"and"project
manager"modified appropriately to preserve the State's rights.
Section 12.04 HHSC personnel recruitment prohibition.
CONTRACTOR has not retained or promised to retain any person or company, or utilized or promised to utilize
a consultant that participated in HHSC's development of specific criteria of the Agreement or who participated in the
selection of the CONTRACTOR for the Agreement.
CONTRACTOR will not recruit or employ any HHSC professional or technical personnel who have worked on
projects relating to the subject matter of the Agreement, or who have had any influence on decisions affecting the
subject matter of the Agreement, for two(2)years following the completion of the Agreement.
Section 12.05 Anti-kickback provision.
CONTRACTOR certifies that it will comply with the Anti-Kickback Act of 1986, 41 USC§51-58 and Federal
Acquisition Regulation 52.203-7.
Section 12.06 Debt or back taxes owed to the State of Texas.
In accordance with Section 403.055 of the Government Code, CONTRACTOR agrees that any payments due to
CONTRACTOR under the Agreement will be first applied toward any debt or back taxes CONTRACTOR owes the
State of Texas. CONTRACTOR further agrees that payments will be so applied until such debts and back taxes are
paid in full.
Section 12.07 Certification regarding status of license, certificate, or permit.
Article IX, Section 163 of the General Appropriations Act for the 1998/1999 state fiscal biennium prohibits an
agency that receives an appropriation under either Article II or V of the General Appropriations Act from awarding an
Agreement with the owner, operator, or administrator of a facility that has had a license, certificate, or permit revoked
by another Article II or V agency. CONTRACTOR certifies it is not ineligible for an award under this provision.
Section 12.08 Outstanding debts and judgments.
CONTRACTOR certifies that it is not presently indebted to the State of Texas, and that CONTRACTOR is not
subject to an outstanding judgment in a suit by the State of Texas against CONTRACTOR for collection of the
balance. For purposes of this Section, an indebtedness is any amount sum of money that is due and owing to the
State of Texas and is not currently under dispute.A false statement regarding CONTRACTOR's status will be treated
as a material breach of the Agreement and may be grounds for termination at the option of HHSC.
Section 12.09 Anti-trust.
In submitting a proposal, and in accepting the Contract or purchase order, Contractor certifies and agrees as
follows:
Page 24 of 31
(1) Neither the CONTRACTOR, nor the person represented by the CONTRACTOR, nor any person acting for
the represented person has:
(a)violated the antitrust laws codified by Chapter 15, Business&Commerce Code, or the federal antitrust
laws; or
(b)directly or indirectly communicated the bid/offer associated with this contract to a competitor or other
person engaged in the same line of business.
(2)CONTRACTOR assigns to HHSC all of CONTRACTOR's rights,title, and interest in and to all claims and
causes of action CONTRACTOR may have under the antitrust laws of Texas or the United States for overcharges
associated with this contract.
Article 13. Representations and Warranties
Section 13.01 Authorization.
(a)The execution, delivery and performance of the Agreement has been duly authorized by CONTRACTOR
and no approval, authorization or consent of any governmental or regulatory agency is required to be obtained in
order for CONTRACTOR to enter into the Agreement and perform its obligations under the Agreement.
(b)CONTRACTOR has obtained and will maintain all licenses, certifications, permits, and authorizations
necessary to perform the Services under the Agreement and currently is in good standing with all regulatory agencies
that regulate any or all aspects of CONTRACTOR's performance of the Agreement. CONTRACTOR will maintain all
required certifications, licenses, permits, and authorizations to remain in good standing during the term of the
Agreement.
Section 13.02 Ability to perform.
CONTRACTOR warrants that it has the financial resources to fund the capital expenditures required under the
Agreement without advances by HHSC or assignment of any payments by HHSC to a financing source.
Section 13.03 Workmanship and performance.
(a)All Services and Deliverables provided under the Agreement will be provided in a manner consistent with the
standards of quality and integrity as outlined in the Agreement, the Solicitation, and CONTRACTOR's Proposal.
(b)All Services and Deliverables must meet or exceed the required levels of performance specified in or under
the Agreement, and will meet or exceed HHSC's Missions and Objectives, as set forth in the Solicitation.
(c)CONTRACTOR will perform the Services in a workmanlike manner, in accordance with best practices and
high professional standards used in well-managed operations performing services similar to the services described in
the Agreement.
Section 13.04 Warranty of deliverables.
CONTRACTOR warrants that Deliverables developed and delivered under the Agreement will meet the
specifications as described in the Agreement during the period following its acceptance by HHSC,through the term of
the Agreement, including any extensions as provided in the Agreement,that are subsequently negotiated by
CONTRACTOR and HHSC. CONTRACTOR will promptly repair or replace any such Deliverables not in compliance
with this warranty at no charge to HHSC.
Section 13.05 Manufacturers'warranties.
CONTRACTOR assigns to HHSC all of the manufacturers'warranties and indemnities relating to all products,
including without limitation,Third Party Software to the extent CONTRACTOR is permitted by the manufacturers to
make such assignments to HHSC. Such assignment is subject to all of the terms and conditions imposed by the
manufacturers with respect thereto.
Section 13.06 Compliance with Agreement.
CONTRACTOR will not take any action substantially or materially inconsistent with any of the terms and
conditions set forth in the Agreement without the written approval of HHSC.
Article 14.Intellectual Property
Section 14.01 Infringement and misappropriation.
(a)CONTRACTOR warrants that all Deliverables provided by CONTRACTOR will not infringe or misappropriate
any right of, and will be free of any claim of, any third person or entity based on copyright, patent, trade secret, or
other intellectual property rights.
Page 25 of 31
(b)CONTRACTOR WILL,AT ITS EXPENSE, DEFEND WITH COUNSEL APPROVED BY HHSC, INDEMNIFY,
AND HOLD HARMLESS HHSC, ITS EMPLOYEES,OFFICERS, DIRECTORS,CONTRACTORS,AND AGENTS
FROM AND AGAINST ANY LOSSES, LIABILITIES, DAMAGES, PENALTIES,COSTS, FEES, INCLUDING
WITHOUT LIMITATION REASONABLE ATTORNEYS' FEES AND EXPENSES, FROM ANY CLAIM OR ACTION
AGAINST HHSC THAT IS BASED ON A CLAIM OF BREACH OF THE WARRANTY SET FORTH IN THE
PRECEDING PARAGRAPH.HHSC WILL PROMPTLY NOTIFY CONTRACTOR IN WRITING OF THE CLAIM,
PROVIDE CONTRACTOR A COPY OF ALL INFORMATION RECEIVED BY HHSC WITH RESPECT TO THE
CLAIM,AND COOPERATE WITH CONTRACTOR IN DEFENDING OR SETTLING THE CLAIM.
(c) In case the Deliverables, or any one or part thereof, is in such action held to constitute an infringement or
misappropriation, or the use thereof is enjoined or restricted or if a proceeding appears to CONTRACTOR to be likely
to be brought, CONTRACTOR will, at its own expense, either:
(1) Procure for HHSC the right to continue using the Deliverables; or
(2)Modify or replace the Deliverables to comply with the Specifications and to not violate any intellectual
property rights.
If neither of the alternatives set forth in(1)or(2)above are available to the CONTRACTOR on commercially
reasonable terms, CONTRACTOR may require that HHSC return the allegedly infringing Deliverable(s) in which case
CONTRACTOR will refund all amounts paid for all such Deliverables and reimburse HHSC for any related direct and
indirect damages incurred by HHSC due to the infringing Deliverable(s).
Section 14.02 Exceptions.
CONTRACTOR is not responsible for any claimed breaches of the warranties set forth in Section 14.01 to the
extent caused by:
(a) Modifications made to the item in question by anyone other than CONTRACTOR or its subcontractors or
HHSC or its Contractors working at CONTRACTOR's direction or in accordance with the specifications; or
(b) The combination, operation, or use of the item with other items if CONTRACTOR did not supply or approve
for use with the item; or
(c) HHSC's failure to use any new or corrected versions of the item made available by CONTRACTOR.
Article 15. Liability
Section 15.01 Property damage.
(a)CONTRACTOR will protect HHSC's real and personal property from damage arising from CONTRACTOR's,
its agent's, employees'and subcontractors'performance of the Agreement, and CONTRACTOR will be responsible
for any loss,destruction, or damage to HHSC's property that results from or is caused by CONTRACTOR's, its
agents', employees'or subcontractors'negligent or wrongful acts or omissions. Upon the loss of, destruction of, or
damage to any property of HHSC, CONTRACTOR will notify the HHSC Project Manager thereof and, subject to
direction from the Project Manager or her or his designee,will take all reasonable steps to protect that property from
further damage.
(b)CONTRACTOR agrees to observe and require its employees and agents to observe safety measures and
proper operating procedures at HHSC sites at all times.
(c)CONTRACTOR will distribute a policy statement to all of its employees and agents that directs the employee
or agent to immediately report to HHSC or to CONTRACTOR any special defect or unsafe condition encountered
while on HHSC premises. CONTRACTOR will immediately report to HHSC any special defect or an unsafe condition
it encounters or otherwise learns about.
Section 15.02 Risk of Loss.
During the period Deliverables are in transit and in possession of CONTRACTOR, its carriers or HHSC prior to
being accepted by HHSC, CONTRACTOR will bear the risk of loss or damage thereto, unless such loss or damage is
caused by the negligence or intentional misconduct of HHSC.After HHSC accepts a Deliverable,the risk of loss or
damage to the Deliverable will be borne by HHSC,except loss or damage attributable to the negligence or intentional
misconduct of CONTRACTOR's agents, employees or subcontractors.
Section 15.03 Limitation of HHSC's Liability.
HHSC WILL NOT BE LIABLE FOR ANY INCIDENTAL, INDIRECT,SPECIAL,OR CONSEQUENTIAL
DAMAGES UNDER CONTRACT,TORT(INCLUDING NEGLIGENCE),OR OTHER LEGAL THEORY.THIS WILL
APPLY REGARDLESS OF THE CAUSE OF ACTION AND EVEN IF HHSC HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES.
Page 26 of 31
HHSC'S LIABILITY TO CONTRACTOR UNDER THE AGREEMENT WILL NOT EXCEED THE TOTAL
CHARGES TO BE PAID BY HHSC TO CONTRACTOR UNDER THE AGREEMENT, INCLUDING CHANGE
ORDER REQUEST PRICES AGREED TO BY THE PARTIES OR OTHERWISE ADJUDICATED.
Article 16.Special Terms and Conditions
Section 16.01 HHSC Data Use Agreement Not Required
The HHSC Data Use Agreement is not required to be incorporated into the Agreement because:
7 CONTRACTOR does not Access Confidential Information; or
n CONTRACTOR accesses Other Confidential Information as defined in the Agreement and
CONTRACTOR agrees:
CONTRACTOR and all subcontractors, consultants, or agents under the Agreement will treat all
information that is obtained through performance of the Services under the Agreement, including, but not
limited to, information relating to applicants or recipients of HHSC Programs as Other Confidential
Information to the extent that such information is considered Other Confidential Information in the
Agreement.
(a) CONTRACTOR is responsible for understanding the degree to which information obtained
through performance of the Agreement is confidential under state and federal law, regulations, or
administrative rules as applicable.
(b)CONTRACTOR and all subcontractors, consultants, or agents under the Agreement will not use any
information obtained through performance of the Agreement in any manner except as is necessary to the proper
discharge of obligations and securing of rights under the Agreement.
(c)CONTRACTOR will have a system in effect to protect all records, documents, or Other Confidential
Information under the Agreement that is obtained or maintained in connection with the activities funded under the
Agreement.Any disclosure or transfer of Other Confidential Information by CONTRACTOR, including information
required by HHSC, will be in accordance with the Agreement. If the CONTRACTOR receives a request for
information deemed Other Confidential Information under the Agreement, CONTRACTOR will immediately notify the
State of the request, and will make reasonable efforts to protect the information from public disclosure until further
instructed by HHSC.
(d) In addition to the requirements stated in this Section, CONTRACTOR must comply with any policy, rule, or
reasonable requirement of HHSC that relates to the safeguarding or disclosure of Other Confidential Information
relating to HHSC Programs recipients, CONTRACTOR'S operations, or the CONTRACTOR performance of the
Agreement.
(e) Upon expiration of the Agreement, or termination of the Agreement for any reason, all Other Confidential
Information of a Party disclosed to, and all copies made by the other Party, will be returned to the disclosing Party or,
at the disclosing Party's option, erased or destroyed, subject to laws governing the destruction of public information.
The recipient of the Other Confidential Information must provide the disclosing Party certificates evidencing this
erasure or destruction.
(f)CONTRACTOR will immediately report to HHSC any and all unauthorized disclosures or uses of Other
Confidential Information upon it or its subcontractor(s), consultant(s), or agent(s)becoming aware or acquiring
knowledge of the disclosure. CONTRACTOR acknowledges that any publication or disclosure of Other Confidential
Information may cause immediate and irreparable harm to HHSC and may constitute a violation of State or federal
laws. If CONTRACTOR, its subcontractor(s), consultant(s), or agent(s)should publish or disclose such Other
Confidential Information to others without authorization, HHSC will immediately be entitled to injunctive relief or any
other remedies to which it is entitled under law or equity without requiring a cure period as described in Article 11.
HHSC will have the right to recover from CONTRACTOR all damages and liabilities caused by or arising from
Contractor's, its subcontractors', consultants', or agents'failure to protect HHSC's Confidential Information.
CONTRACTOR WILL DEFEND WITH COUNSEL APPROVED BY HHSC, INDEMNIFY AND HOLD HARMLESS
HHSC FROM ALL DAMAGES,COSTS,LIABILITIES,AND EXPENSES(INCLUDING WITHOUT LIMITATION
REASONABLE ATTORNEYS' FEES AND COSTS)CAUSED BY OR ARISING FROM CONTRACTOR'S OR ITS
SUBCONTRACTORS',CONSULTANTS'OR AGENTS' FAILURE TO PROTECT OTHER CONFIDENTIAL
INFORMATION.
(g)CONTRACTOR will require its subcontractor(s), consultant(s), and agent(s)to comply with the terms of this
provision.
(h)The obligations in this Section do not restrict any disclosure by a Party under any applicable law, or by order
of any court or government agency, provided that the disclosing Party must give prompt notice to the non-disclosing
Party of such order.
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(i)With the exception of HHSC Program recipient or client information, Other Confidential Information of a Party
will not be afforded the protection of the Agreement if this data was:
(1)Already known to the receiving Party without restrictions at the time of its disclosure by the furnishing
Party;
(2)Independently developed by the receiving Party without reference to the furnishing Party's confidential
Information;
(3) Rightfully obtained by the other Party without restriction from a third party after its disclosure by the
furnishing Party;
(4) Publicly available other than through the fault or negligence of the other Party; or
(5)Released without restriction to anyone.
n Section 16.02 Financial/performance
audits.
(a)Texas Health and Safety Code Section 12.0123 directs HHSC to contract with an independent auditor to
perform annual independent external financial and performance audits of any Medicaid contractor used by HHSC in
HHSC's operation of a part of the State Medicaid program. "Medicaid contractor" means an entity that, under a
contract with or otherwise on behalf of HHSC, performs one or more administrative services in relation to HHSC's
operation of a part of the State Medicaid program, such as claims processing, utilization review, client enrollment,
provider enrollment, quality monitoring, or payment of claims. The independent auditor will deliver to the
CONTRACTOR and to HHSC a report of the findings and recommendations within 30 calendar days of the close of
each audit. The report will be prepared in accordance with generally accepted auditing standards.
(b)CONTRACTOR agrees to deliver to HHSC, for HHSC's approval, a Corrective Action Plan that addresses
deficiencies identified in the audit within 30 calendar days of the delivery of the independent auditor's report.
(c)CONTRACTOR understands that the independent auditor("the auditor")will make specific inquiries of
CONTRACTOR's management for information, including but not limited to information concerning the representations
embodied in the financial statements and reports CONTRACTOR is required to furnish the State as per any financial
report requirements in the Agreement. CONTRACTOR understands that as part of the auditor's audit procedures, the
auditor will request, and CONTRACTOR's management will provide to the auditor a representation letter;
(1)Acknowledging management's responsibility for the preparation of the financial statements and reports;
(2)Acknowledging management's responsibility for compliance with laws and regulations; and
(3)Affirming management's belief that the effects of any uncorrected financial statement or report
misstatements aggregated by the auditor during the current audit engagement and pertaining to the period
presented are immaterial, both individually and in the aggregate, to the financial statements and reports taken as
a whole.
(d)CONTRACTOR understands and agrees that the auditor will also request that CONTRACTOR's
management confirm certain representations made to the auditor during the audit. The responses to those inquiries,
and the related written representations of management required by generally accepted auditing standards, are part of
the evidential matter that the auditor will rely on in forming its opinion on the CONTRACTOR's financial statements
and reports.
❑ Section 16.03 Audit software.
As part of the Services, CONTRACTOR must operate and maintain audit software that HHSC or its designees
may provide to CONTRACTOR from time to time during the Term of the Agreement.
❑ Section 16.04 Ownership and licenses.
(a) Custom software.
The Parties agree that any Deliverable, including any software, developed by CONTRACTOR in connection with
the Agreement(the"Custom Software"), will be the exclusive property of HHSC.
(b) Ownership rights.
(1) HHSC will own all right, title, and interest in and to its Confidential Information and the Deliverables provided
by CONTRACTOR, including without limitation the specifications, a work pan, and the Custom Software, except that
the Deliverables will not include the third party software and the associated Documentation for purposes of this
Section. CONTRACTOR will take all actions necessary and transfer ownership of the Deliverables to HHSC,
Page 28 of 31
including the Custom Software and associated Documentation on final acceptance or as otherwise provided in the
Agreement.
(2)CONTRACTOR will furnish Custom Software and Documentation, upon request of HHSC, in accordance
with applicable State law.All Deliverables, in whole and in part,will be deemed works made for hire of HHSC for all
purposes of copyright law, and copyright will belong solely to HHSC. To the extent that any Deliverable under this
Section does not qualify as a work for hire under applicable law, and to the extent that the Deliverable includes
materials subject to copyright, patent,trade secret, or other proprietary right protection, CONTRACTOR assigns all
right, title, and interest in and to Deliverables, including all copyrights, inventions, patents,trade secrets, and other
proprietary rights in the Deliverables(including any proprietary right renewals)to HHSC.
(3)CONTRACTOR will, at the expense of HHSC, assist HHSC or its designees to obtain copyrights,
trademarks, or patents for all such Deliverables in the United States and any other countries. CONTRACTOR agrees
to execute all papers and to give all facts known to it necessary to secure United States or foreign country copyrights
and patents, and to transfer or cause to transfer to HHSC all the right,title, and interest in and to such Deliverables.
CONTRACTOR also agrees not to assert any moral rights under applicable copyright law with regard to such
Deliverables.
(c) License Rights
HHSC will have ownership and unlimited rights to use, disclose, duplicate, or publish all information and data
developed,derived,documented, or furnished by CONTRACTOR under or resulting from the Agreement. Such data
will include all results,technical information, and materials developed for or obtained by HHSC from CONTRACTOR
in the performance of the Services hereunder, including but not limited to all reports, surveys, plans, charts,
recordings(video or sound), pictures, drawings, analyses, source and object code, graphic representations, computer
programs and printouts, notes and memoranda, and documents whether finished or unfinished,which result from or
are prepared in connection with the Services performed as a result of the Agreement.
(d) Proprietary Notices
CONTRACTOR will reproduce and include HHSC's copyright and other proprietary notices and product
identifications provided by CONTRACTOR on such copies, in whole or in part, or on any form of the Deliverables.
(e) Third Party Software and Documentation Licenses
(1)CONTRACTOR grants HHSC a non-exclusive, perpetual, license for HHSC to use the Third Party
Software and its associated Documentation for its internal business purposes. HHSC will be entitled to use the
Third Party Software on the Equipment or any replacement equipment used by HHSC, and with any replacement
Third Party Software chosen by HHSC,without additional Charges. Terms in any licenses for Third Party Software
will be consistent with the requirements of this Section.
(2)The licenses hereunder are granted as of the date when such Third Party Software is installed and
certified by CONTRACTOR as operational, and the licenses will continue until HHSC permanently discontinues
the use of the Third Party Software.
(3) Prior to utilizing any Third Party Software product that may be included as part of a Software Deliverable
to HHSC, CONTRACTOR will provide to HHSC copies of the license agreement from the licensor of the Third
Party Software to allow HHSC to pre-approve the license agreement that must, at a minimum, provide HHSC with
necessary rights consistent with the short and long-term goals of the Agreement. CONTRACTOR will assign to
HHSC the licenses for the Third Party Software upon Final Acceptance.
(4)CONTRACTOR will, during the project, maintain any and all Third Party Software products at their most
current version or no more than one version back from the most current version. However, CONTRACTOR will not
maintain any Third Party Software versions, including one version back, if any such version would prevent HHSC
from using any functions, in whole or in part, or would cause deficiencies in the system.
(f) State and Federal Governments
In accordance with 45 C.F.R. Part 95.617, all appropriate State and Federal agencies will have a royalty-free,
nonexclusive, and irrevocable license to reproduce, publish,translate, or otherwise use, and to authorize others to
use for Federal Government purposes all materials, the Custom Software and modifications thereof, and associated
documentation designed, developed, or installed with Federal Financial Participation under the Agreement, including
but not limited to those materials covered by copyright, all Software source and object code, instructions, files, and
Documentation composing the System.
n Section 16.05 Insurance Coverage.
(a) Required Coverage.
(1)CONTRACTOR will procure, at CONTRACTOR's own expense, during the Term of the Agreement and
until final acceptance of all Services and Deliverables, the following insurance coverage. CONTRACTOR will
Page 29 of 31
provide HHSC with proof of the following insurance coverage within 10 calendar days after the Agreement is
awarded upon HHSC's request:
(A) Standard Worker's Compensation Insurance coverage;
(B) Automobile Liability; and
(C) Commercial General Liability Insurance including Bodily Injury coverage of$100,000.00 per each
occurrence and Property Damage Coverage of$25,000.00 per each occurrence.
(2)If CONTRACTOR's current Commercial General Liability insurance coverage does not meet the above
stated requirements, CONTRACTOR will obtain excess liability insurance to compensate for the difference in the
coverage amounts prior to effective date of the Agreement.
(3)CONTRACTOR is responsible for all deductibles stated in the policies. Insurance will be maintained at all
times during the performance of the Agreement. Insurance coverage will be issued by insurance companies with
"A"rating from Best that are authorized by applicable law to conduct business and provide the required coverage
in the State of Texas, and must name HHSC as an additional insured.
(4)The policy will have an extended reporting period of two years.When policies are renewed or replaced,
the policy retroactive date must coincide with, or precede, start of work on the Agreement.
(b) Proof of Insurance Coverage
(1)CONTRACTOR will furnish the HHSC Project Manager original Certificates of Insurance evidencing the
required coverage to be in force on the date of award, and renewal certificates of insurance, or such similar evidence,
if the coverages have an expiration or renewal date occurring during the term of the Agreement. The failure of HHSC
to obtain this evidence from CONTRACTOR before permitting CONTRACTOR to commence work will not be deemed
to be a waiver by HHSC and CONTRACTOR will remain under continuing obligation to maintain and provide proof of
the insurance coverage.
(2)The insurance specified above will be carried until all services required to be performed under the terms of
the Agreement are satisfactorily completed. Failure to carry or keep such insurance in force will constitute a
violation of the Agreement, and HHSC maintains the right to stop work until proper evidence of insurance is
provided.
(3)The insurance will provide for 30 calendar days prior written Notice to be given to HHSC in the event
coverage is substantially changed, canceled, or non-renewed. CONTRACTOR must submit a new coverage
binder to HHSC to ensure no break in coverage.
(4)CONTRACTOR will require all subcontractors operating in Texas to carry the same or more coverage as
CONTRACTOR is required to carry under the Agreement. CONTRACTOR may provide the coverage for any
subcontractor, and, if provided, the evidence of insurance submitted will so stipulate.
(5)The Parties understand and agree that any insurance coverages and limits furnished by CONTRACTOR
will in no way expand or limit CONTRACTOR's liabilities and responsibilities specified within the Contract
documents or by applicable law.
(6)CONTRACTOR and each subcontractor will require that insurer will waive their rights of subrogation
against HHSC.
(7)CONTRACTOR understands and agrees that any insurance maintained by HHSC will apply in excess of
and not contribute with insurance provided by CONTRACTOR under the Agreement.
(8) If CONTRACTOR, or its subcontractor(s), desire additional coverage, higher limits of liability, or other
modifications for its own protection, CONTRACTOR and each of its subcontractors will be responsible for the
acquisition and cost of this additional protection at no additional cost to HHSC.
(9)CONTRACTOR may not transport a client or conduct any other official business on behalf of HHSC
without the required coverage of the Agreement. CONTRACTOR agrees and understands that HHSC will not be
liable for any accident or death due to an automobile accident involving the CONTRACTOR or CONTRACTOR's
employee, even if the accident or death occurs in the course of performing any work under the Agreement. Failure
to meet this provision may be considered a material breach of the Agreement.
Section 16.06 Background Checks.
x
CONTRACTOR must obtain a criminal background check, including fingerprints in a form and of a quality
acceptable to the Department of Public Safety and the Federal Bureau of Investigation, on any Contractor's
employees or agents, including Subcontractors and Subcontractor employees or agents,who would be placed in
direct contact with a resident or client.
Page 30 of 31
CONTRACTOR must also perform checks against the Nurse Aide Registry and the Employee Misconduct
Registry maintained on DADS' Employability Status Check Search website. CONTRACTOR must perform any
criminal background checks at its expense and should limit its search to the United States of America.
CONTRACTOR will not utilize an employee, Subcontractor, or Subcontractor's employee to perform a site visit or
have any contact with stakeholders, patients, residents, or their family members if:
(a) CONTRACTOR determines, as a result of a criminal background check, that the person has been
convicted of an offense listed in Tex. Health &Safety Code§250.006 that bars employment or if the
Consultant makes a reasonable determination that a conviction may pose a risk to any stakeholders,
patients, residents, or their family members; or
(b) the employee or Subcontractor or Subcontractor's employee is listed in the Nurse Aide Registry or the
Employee Misconduct Registry.
Section 16.07 Historically Underutilized
Business Participation Requirements
This Subsection applies if HHSC determined that sub-contracting opportunities were probable for
the procurement/contract.
(a) Definitions.
For purposes of this Section:
(1)"Historically Underutilized Business"or"HUB"means a minority or women-owned business as defined
by Texas Government Code, Chapter 2161.
(2)"HSP"means a HUB Subcontracting Plan.
(b)HUB Requirements.
(1)Contractor must submit an HSP for HHSC's approval.
(2)Contractor must report to HHSC's contract manager and HUB Office monthly, in the format required by the
HUB Office, its use of HUB subcontractors to fulfill the subcontracting opportunities identified in the HSP.
(3) If the Parties amend the Agreement to include additional funds or a change to the Scope of Work,the
Contractor must submit a revised HSP to the HHSC HUB Office,when a determination is made for additional
subcontracting opportunities.All proposed changes to the HSP must comply with the requirements of Section
16.07(b)(4).
(4)Contractor must obtain prior written approval from the HHSC HUB Office before making any changes to the
HSP.The proposed changes must comply with HHSC's good faith effort requirements relating to the
development and submission of HSPs.
(5)HHSC will determine if the value of Subcontracts to HUBs meet or exceed the HUB subcontracting
provisions specified in the Contractor's HSP. If HHSC determines that the Contractor's subcontracting activity
does not demonstrate a good faith effort, the Contractor may be subject to provisions in the Vendor Performance
and Debarment Program
(34 Tex.Admin. Code Chapter 20, Subchapter C), and subject to remedies for Breach.
Page 31 of 31
Texas Health and Human Services Commission
Texas Home Visiting Program
Attachment D: Twelve-Month Budget Form
Agency Name: CITY OF PORT ARTHUR
Budget Period: September 1,2015-August 31, 2016
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Salary $375,365.00 $375,365.00
Fringe $182,615.00 $182,615.00
Equipment $0.00 $0.00
Supplies $5,795.00 $0.00
Travel 535,248.00 $14,597.00
Contractual $22,303.00
$4,141.00
Other $17,335.00
_ ;�._ - - - _:�; - $3,915.00
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Total ' 35 S g $638,661.00 •
$580,633.00
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Prepared by: Judith Smith, RN, BSN
Title: Director of Health Services
Certifying Official Name:
Title:
Signature of Certifying Official:
Date Certified:
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Program
Attachment E: Twelve-Month Budget Form
Agency Name: CITY OF PORT ARTHUR
Budget Period: September 1, 2015-August 31, 2016
Longevity $1,238.63 $1,238.63
Social Security (6.2%)0
$23,272.63
$23,272.63
Medicare Benefits (1.4 } $5,255.11 $5,255.11
TMRS (15%) $56,304.75 $56,304.75
Workers Comp (1%)
$3,753.65 $3,753.65
Terminatng Pay(2 %) $7,507.30 $7,507.30
Hospital Insurance(22.72%) $85,282.93 $85,282.93
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Texas Health and Human Services Commission
Texas Home Visiting Program
Attachment E: Twelve-Month Budget Form
Agency Name: CITY OF PORT ARTHUR
Budget Period: September 1,2015-August 31, 2016
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Texas Health and Human Services Commission
Texas Home Visiting Program
Attachment E: Twelve-Month Budget Form
Agency Name: CITY OF PORT ARTHUR
Budget Period: September 1, 2015-August 31, 2016
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Copy paper, pens, classification folders, file jackets, $1,405.00
labels, toner, staples, highlighters, envelopes, tape,
card stock, award folders, postage etc.
Marketing supplies(table cloth for health fairs), sippy $1,000.00
cups, onesies, etc)
Baby scales $1,500.00
DVD Players for patient education $300.00
DVD's for client teaching $1,590.00
55,7g5r.OQ • $0.00
Texas Health and Human Services Commission
Texas Home Visiting Program
Attachment E: Twelve-Month Budget Form
Agency Name: CITY OF PORT ARTHUR
Budget Period: September 1, 2015-August 31, 2016
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Nurse Supervisor face to face meetings $2,600.00 $2,600.00
Travel for training for 1 nurse $1,500.00
Administrator training in Denver $600.00 $600.00
Local travel @.575 for 930/miles/month/4 nurses $25,668.00 $6,517.00
Local Travel @.575/month for 175miles/nurse supervisor $1,380.00 $1,380.00
PIP conference $3,500.00 $3,500.00
Texas Health and Human Services Commission
Texas Home Visiting Program
Attachment E: Twelve-Month Budget Form
Agency Name: CITY OF PORT ARTHUR
Budget Period: September 1, 2015-August 31, 2016
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NSO for Program support and nurse consultation $22,303.00 $3,621.09
Administration Orientation $519.91
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Texas Health and Human Services Commission
Texas Home Visiting Program
Attachment E: Twelve-Month Budget Form
Agency Name: CITY OF PORT ARTHUR
Budget Period: September 1, 2015-August 31, 2016
Kt, 4a1 .ti- Exp fidl sr I O i k4■per j 1 1-
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Cell Phones usage $400/monthly $4,800.00
IPAD monthly data fees @a $200/monthly $2,400.00
AT&T for faxes $720.00
Copier Rental $5,500.00
DANCE-Recertification $275.00 $275.00
Breastfeeding Recertification $1,640.00 $1,640.00
Professional Development( Kaleidoscope) $2,000.00 $2,000.00
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Initial(new hire) Initial
Annual Annual Nurse Home Visitor Initial(new hire)
Nurse Annual Pmgram � Nurse Home Visitor Education Su
Educational Ed
Connsultation
Support Transmittal Materials Fee Tuition Fee Tui
ee
Fee Fee
per NNV-Sup $ Plan to Attend $ Pian to Attend
$ 9,132 $ 7,620 $ 592 1 $ 559 1 $ 4,400 1
(new hire) Initial(n
Annual Annual Annual Nurse Hot
pervisor Administrator Orientation
iucation Nurse Program Data Educa
tion Fee Connsultation Support Transmittal Materl
Fee Fee Fee
$ Plan to Attend s Total per NI IV
$ 5,264 1 $ 519 $28,086 $ 9,817 $ 8,192 $ 636 1
2017
ew hire) initial(new hire) Initial(new hire)
ne Visitor Supervisor
tional Nurse Home Visitor Education Administrator Orientation
Education
als Fee Tuition Fee Tuition Fee
$ Plan to Attend S Plan to Attend S Plan to Attend $ Total
$ 601 1 $ 4,730 1 $ 5,659 1 $ 557 $ 30,192
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I
DATA USE AGREEMENT
BETWEEN THE
TEXAS HEALTH AND HUMAN SERVICES ENTERPRISE
AND
CITY OF PORT ARTHUR("CONTRACTOR")
This Data Use Agreement("DUA"),effective as of the Base Contract("Effective Date"),is entered
into by and between the Texas Health and Human Services Enterprise agency("HHS")and City of Port
Arthur("CONTRACTOR"),and incorporated into the terms of HHS Contract No.529-16-0003-000 ,in
Travis County,Texas(the"Base Contract").
ARTICLE 1.PURPOSE; APPLICABILITY; ORDER OF PRECEDENCE
The purpose of this DUA is to facilitate creation, receipt, maintenance, use, disclosure or access to
Confidential Information with CONTRACTOR, and describe CONTRACTOR's rights and obligations with
respect to the Confidential Information and the limited purposes for which the CONTRACTOR may create,
receive, maintain, use, disclose or have access to Confidential Information. 45 CFR 164.504(e)(1)-(3) This
DUA also describes HHS's remedies in the event of CONTRACTOR's noncompliance with its obligations
under this DUA. This DUA applies to both Business Associates and contractors who are not Business
Associates who create, receive, maintain, use, disclose or have access to Confidential Information on behalf
of HHS,its programs or clients as described in the Base Contract.
As of the Effective Date of this DUA, if any provision of the Base Contract, including any General
Provisions or Uniform Terms and Conditions,conflicts with this DUA,this DUA controls.
ARTICLE 2. DEFINITIONS
For the purposes of this DUA, capitalized, underlined terms have the meanings set forth in the
following: Health Insurance Portability and Accountability Act of 1996, Public Law 104-191 (42 U.S.C.
§1320d, et seq.) and regulations thereunder in 45 CFR Parts 160 and 164, including all amendments,
regulations and guidance issued thereafter; The Social Security Act, including Section 1137 (42 U.S.C.
§§ 1320b-7), Title XVI of the Act; The Privacy Act of 1974, as amended by the Computer Matching and
Privacy Protection Act of 1988, 5 U.S.C. § 552a and regulations and guidance thereunder; Internal Revenue
Code,Title 26 of the United States Code and regulations and publications adopted under that code,including
IRS Publication 1075; OMB Memorandum 07-18; Texas Business and Commerce Code Ch. 521; Texas
Government Code, Ch. 552, and Texas Government Code §2054.1125. In addition, the following terms in
this DUA are defined as follows:
"Authorized Purpose"means the specific purpose or purposes described in the Scope of Work of
the Base Contract for CONTRACTOR to fulfill its obligations under the Base Contract,or any other purpose
expressly authorized by HHS in writing in advance.
"Authorized User"means a Person:
(1) Who is authorized to create, receive, maintain, have access to, process, view, handle,
examine,interpret,or analyze Confidential Information pursuant to this DUA;
(2) For whom CONTRACTOR warrants and represents has a demonstrable need to create,
receive, maintain,use,disclose or have access to the Confidential Information; and
(3) Who has agreed in writing to be bound by the disclosure and use limitations pertaining to
the Confidential Information as required by this DUA.
HHS Data Use Agreement V.8.3 HIPAA Omnibus Compliant April 1,2015
GOVERNMENTAL ENTITY VERSION
HHS Contract No. 529-16-0003-0000
"Confidential Information" means any communication or record (whether oral, written,
electronically stored or transmitted, or in any other form) provided to or made available to CONTRACTOR
or that CONTRACTOR may create,receive,maintain,use, disclose or have access to on behalf of HHS that
consists of or includes any or all of the following:
(1) Client Information;
(2) Protected Health Information in any form including without limitation, Electronic
Protected Health Information or Unsecured Protected Health Information;
(3) Sensitive Personal Information defined by Texas Business and Commerce Code Ch. 521;
(4) Federal Tax Information;
(5) Personally Identifiable Information;
(6) Social Security Administration Data, including, without limitation, Medicaid
information;
(7) All privileged work product;
(8) All information designated as confidential under the constitution and laws of the State of
Texas and of the United States, including the Texas Health & Safety Code and the Texas Public
Information Act,Texas Government Code,Chapter 552.
"Legally Authorized Representative" of the Individual, as defined by Texas law, including as
provided in 45 CFR 435.923 (Medicaid); 45 CFR I64.502(g)(1) (HIPAA); Tex. Occ. Code § 151.002(6);
Tex.H.&S.Code§166.164;Estates Code Ch.752 and Texas Prob.Code§3.
ARTICLE 3.CONTRACTOR'S DUTIES REGARDING CONFIDENTIAL INFORMATION
Section 3.01 Obligations of CONTRACTOR
CONTRACTOR agrees that:
(A) CONTRACTOR will exercise reasonable care and no less than the same degree of care
CONTRACTOR uses to protect its own confidential, proprietary and trade secret information to prevent
any portion of the Confidential Information from being used in a manner that is not expressly an
Authorized Purpose under this DUA or as Required by Law.45 CFR 164.502(b)(1);45 CFR 164.514(d)
(B) CONTRACTOR will not, without HHS's prior written consent, disclose or allow access
to any portion of the Confidential Information to any Person or other entity, other than Authorized User's
Workforce or Subcontractors of CONTRACTOR who have completed training in confidentiality,privacy,
security and the importance of promptly reporting any Event or Breach to CONTRACTOR's
management,to carry out the Authorized Purpose or as Required by Law.
HHS, at its election, may assist CONTRACTOR in training and education on specific or unique
HHS processes, systems and/or requirements. CONTRACTOR will produce evidence of completed
training to HHS upon request.45 C.F.R. 164.308(a)(5)(1); Texas Health&Safety Code§181.101
(C) CONTRACTOR will establish, implement and maintain appropriate sanctions against
any member of its Workforce or Subcontractor who fails to comply with this DUA, the Base Contract or
applicable law. CONTRACTOR will maintain evidence of sanctions and produce it to HHS upon
request.45 C.F.R. 164.308(a)(1)(ii)(C);164.530(e);164.410(b);164.530(b)(1)
(D) CONTRACTOR will not, without prior written approval of HHS, disclose or provide
access to any Confidential Information on the basis that such act is Required by Law without notifying
HHS so that HHS may have the opportunity to object to the disclosure or access and seek appropriate
HHS Data Use Agreement V.8.3 HIPAA Omnibus Compliant April 1,2015
Page 2 of 12
HHS Contract No. 529-16-0003-0000
relief. If HHS objects to such disclosure or access, CONTRACTOR will refrain from disclosing or
providing access to the Confidential Information until HHS has exhausted all alternatives for relief. 45
CFR 164.5 04(e)(2)(i i)(A)
(E) CONTRACTOR will not attempt to re-identify or further identify Confidential
Information or De-identified Information, or attempt to contact any Individuals whose records are
contained in the Confidential Information, except for an Authorized Purpose, without express written
authorization from HHS or as expressly permitted by the Base Contract. 45 CFR 164.502(d)(2)(i) and(ii)
CONTRACTOR will not engage in prohibited marketing or sale of Confidential Information. 45 CFR
164.501, 164.508(a)(3)and(4); Texas Health& Safety Code Ch. 181.002
(F) CONTRACTOR will not permit, or enter into any agreement with a Subcontractor to,
create, receive, maintain, use, disclose, have access to or transmit Confidential Information, on behalf of
CONTRACTOR without requiring that Subcontractor first execute the Form Subcontractor Agreement,
Attachment 1, which ensures that the Subcontractor will comply with the identical terms, conditions,
safeguards and restrictions as contained in this DUA for PHI and any other relevant Confidential
Information and which permits more strict limitations; and 45 CFR 164.502(e)(1)(1)(ii); 164.504(e)(1)(1)
and(2)
(G) CON TRACTOR is directly responsible for compliance with, and enforcement of, all
conditions for creation, maintenance, use, disclosure, transmission and Destruction of Confidential
Information and the acts or omissions of Subcontractors as may be reasonably necessary to prevent
unauthorized use. 45 CFR 164.504(e)(5);42 CFR 431.300,et seq.
(H) If CONTRACTOR maintains PHI in a Designated Record Set, CONTRACTOR will
make PHI available to HHS in a Designated Record Set or, as directed by HHS, provide PHI to the
Individual, or Legally Authorized Representative of the Individual who is requesting PHI in compliance
with the requirements of the HIPAA Privacy Regulations. CONTRACTOR will make other Confidential
Information in CONTRACTOR's possession available pursuant to the requirements of HIPAA or other
applicable law upon a determination of a Breach of Unsecured PHI as defined in HIPAA. 45 CFR
164.524and 164.504(e)(2)(ii)(E)
(I) CONTRACTOR will make PHI as required by HIPAA available to HHS for amendment
and incorporate any amendments to this information that HHS directs or agrees to pursuant to the HIPAA.
45 CFR 164.504(e)(2)(ii)(E)and(F)
(J) CONTRACTOR will document and make available to HHS the PHI required to provide
access, an accounting of disclosures or amendment in compliance with the requirements of the HIPAA
Privacy Regulations.45 CFR 164.504(e)(2)(ii)(G) and 164.528
(K) If CONTRACTOR receives a request for access, amendment or accounting of PHI by
any Individual subject to this DUA, it will promptly forward the request to HHS; however, if it would
violate HIPAA to forward the request, CONTRACTOR will promptly notify HHS of the request and of
CONTRACTOR's response. Unless CONTRACTOR is prohibited by law from forwarding a request,
HHS will respond to all such requests,unless HHS has given prior written consent for CONTRACTOR to
respond to and account for all such requests. 45 CFR 164.504(e)(2)
(L) CONTRACTOR will provide, and will cause its Subcontractors and agents to provide, to
HHS periodic written certifications of compliance with controls and provisions relating to information
privacy, security and breach notification, including without limitation information related to data transfers
and the handling and disposal of Confidential Information.45 CFR 164.308;164.530(c);1 TAC 202
(M) Except as otherwise limited by this DUA, the Base Contract, or law applicable to the
Confidential Information, CONTRACTOR may use or disclose PHI for the proper management and
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administration of CONTRACTOR or to carry out CONTRACTOR's legal responsibilities if: 45 CFR
164.504(e)(ii)(1)(A)
(1) Disclosure is Required by Law, provided that CONTRACTOR complies with Section
3.01(D);
(2) CONTRACTOR obtains reasonable assurances from the Person to whom the information
is disclosed that the Person will:
(a)Maintain the confidentiality of the Confidential Information in accordance with this DUA;
(b) Use or further disclose the information only as Required by Law or for the Authorized
Purpose for which it was disclosed to the Person; and
(c) Notify CONTRACTOR in accordance with Section 4.01 of any Event or Breach of
Confidential Information of which the Person discovers or should have discovered with the
exercise of reasonable diligence. 45 CFR 164.504(e)(4)(ii)(B)
(N) Except as otherwise limited by this DUA, CONTRACTOR will, if requested by HHS,
use PHI to provide data aggregation services to HHS, as that term is defined in the HIPAA, 45 C.F.R.
§164.501 and permitted by HIPAA. 45 CFR 164.504(e)(2)(0(B)
(0) CONTRACTOR will, on the termination or expiration of this DUA or the Base Contract,
at its expense, return to HHS or Destroy, at HHS's election, and to the extent reasonably feasible and
permissible by law, all Confidential Information received from HHS or created or maintained by
CONTRACTOR or any of CONTRACTOR's agents or Subcontractors on HHS's behalf if that data
contains Confidential Information. CONTRACTOR will certify in writing to HHS that all the
Confidential Information that has been created, received, maintained, used by or disclosed to
CONTRACTOR, has been Destroyed or returned to HHS, and that CONTRACTOR and its agents and
Subcontractors have retained no copies thereof. Notwithstanding the foregoing, CONTRACTOR
acknowledges and agrees that it may not Destroy any Confidential Information if federal or state law, or
HHS record retention policy or a litigation hold notice prohibits such Destruction. If such return or
Destruction is not reasonably feasible, or is impermissible by law, CONTRACTOR will immediately
notify HHS of the reasons such return or Destruction is not feasible, and agree to extend indefinitely the
protections of this DUA to the Confidential Information and limit its further uses and disclosures to the
purposes that make the return of the Confidential Information not feasible for as long as CONTRACTOR
maintains such Confidential Information. 45 CFR 164.504(e)(2)(ii)(J)
(P) CONTRACTOR will create, maintain, use, disclose, transmit or Destroy Confidential
Information in a secure fashion that protects against any reasonably anticipated threats or hazards to the
security or integrity of such information or unauthorized uses. 45 CFR 164.306; 164.530(c)
(Q) If CONTRACTOR accesses, transmits, stores, and/or maintains Confidential
Information, CONTRACTOR will complete and return to HHS at infosecurity(&,,hhsc.state.tx.us the HHS
information security and privacy initial inquiry (SPI) at Attachment 2 . The SPI identifies basic privacy
and security controls with which CONTRACTOR must comply to protect HHS Confidential Information.
CONTRACTOR will comply with periodic security controls compliance assessment and monitoring by
HHS as required by state and federal law, based on the type of Confidential Information CONTRACTOR
creates, receives, maintains, uses, discloses or has access to and the Authorized Purpose and level of risk.
CONTRACTOR's security controls will be based on the National Institute of Standards and Technology
(NIST) Special Publication 800-53. CONTRACTOR will update its security controls assessment
whenever there are significant changes in security controls for HHS Confidential Information and will
provide the updated document to HHS. HHS also reserves the right to request updates as needed to
satisfy state and federal monitoring requirements. 45 CFR 164.306
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(R) CONTRACTOR will establish, implement and maintain any and all appropriate
procedural, administrative, physical and technical safeguards to preserve and maintain the
confidentiality, integrity, and availability of the Confidential Information, and with respect to PHI, as
described in the HIPAA Privacy and Security Regulations, or other applicable laws or regulations relating
to Confidential Information,to prevent any unauthorized use or disclosure of Confidential Information as
long as CONTRACTOR has such Confidential Information in its actual or constructive possession. 45
CFR 164.308 (administrative safeguards); 164.310 (physical safeguards); 164.312 (technical
safeguards);164.530(c)(privacy safeguards)
(S) CONTRACTOR will designate and identify, subject to HHS approval, a Person or
Persons, as Privacy Official 45 CFR 164.530(a)(1) and Information Security Official, each of whom is
authorized to act on behalf of CONTRACTOR and is responsible for the development and
implementation of the privacy and security requirements in this DUA. CONTRACTOR will provide
name and current address, phone number and e-mail address for such designated officials to HHS upon
execution of this DUA and prior to any change. 45 CFR 164.308(a)(2)
(T) CONTRACTOR represents and warrants that its Authorized Users each have a
demonstrated need to know and have access to Confidential Information solely to the minimum extent
necessary to accomplish the Authorized Purpose pursuant to this DUA and the Base Contract,and further,
that each has agreed in writing to be bound by the disclosure and use limitations pertaining to the
Confidential Information contained in this DUA. 45 CFR 164.502;164.514(d)
(U) CONTRACTOR and its Subcontractors will maintain an updated, complete,accurate and
numbered list of Authorized Users, their signatures, titles and the date they agreed to be bound by the
terms of this DUA,at all times and supply it to HHS,as directed, upon request.
(V) CONTRACTOR will implement, update as necessary, and document reasonable and
appropriate policies and procedures for privacy, security and Breach of Confidential Information and an
incident response plan for an Event or Breach, to comply with the privacy, security and breach notice
requirements of this DUA prior to conducting work under the DUA. 45 CFR 164.308; 164.316;
164.514(d);164.530(0(1)
(W) CONTRACTOR will produce copies of its information security and privacy policies and
procedures and records relating to the use or disclosure of Confidential Information received from,
created by, or received, used or disclosed by CONTRACTOR on behalf of HHS for HHS's review and
approval within 30 days of execution of this DUA and upon request by HHS the following business day
or other agreed upon time frame. 45 CFR 164.308;164.514(d)
(X) CONTRACTOR will make available to HHS any information HHS requires to fulfill HHS's
obligations to provide access to, or copies of, PHI in accordance with HIPAA and other applicable laws and
regulations relating to Confidential Information. CONTRACTOR will provide such information in a time
and manner reasonably agreed upon or as designated by the Secretary, or other federal or state law.45 CFR
164.504(e)(2)(i)(I)
(Y) CONTRACTOR will only conduct secure transmissions of Confidential Information
whether in paper,oral or electronic form. A secure transmission of electronic Confidential Information in
motion includes secure File Transfer Protocol (SFTP) or Encryption at an appropriate level or otherwise
protected as required by rule,regulation or law. HHS Confidential Information at rest requires Encryption
unless there is adequate administrative, technical, and physical security, or as otherwise protected as
required by rule, regulation or law. All electronic data transfer and communications of Confidential
Information will be through secure systems. Proof of system, media or device security and/or Encryption
must be produced to HHS no later than 48 hours after HHS's written request in response to a compliance
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investigation, audit or the Discovery of an Event or Breach. Otherwise, requested production of such
proof will be made as agreed upon by the parties. De-identification of HHS Confidential Information is
a means of security. With respect to de-identification of PHI, "secure" means de-identified according to
HIPAA Privacy standards and regulatory guidance.45 CFR 164.312;164.530(d)
(Z) CONTRACTOR will comply with the following laws and standards if applicable to the type of
Confidential Information and Contractor's Authorized Purpose:
• Title 1, Part 10,Chapter 202, Subchapter B,Texas Administrative Code;
• The Privacy Act of 1974;
• OMB Memorandum 07-16;
• The Federal Information Security Management Act of 2002(FISMA);
• The Health Insurance Portability and Accountability Act of 1996 (HIPAA) as defined in the
DUA;
• Internal Revenue Publication 1075 —Tax Information Security Guidelines for Federal, State
and Local Agencies;
• National Institute of Standards and Technology (NIST) Special Publication 800-66 Revision
1 — An Introductory Resource Guide for Implementing the Health Insurance Portability and
Accountability Act(HIPAA) Security Rule;
• NIST Special Publications 800-53 and 800-53A — Recommended Security Controls for
Federal Information Systems and Organizations,as currently revised;
• NIST Special Publication 800-47 — Security Guide for Interconnecting Information
Technology Systems;
• NIST Special Publication 800-88,Guidelines for Media Sanitization;
• NIST Special Publication 800-111, Guide to Storage of Encryption Technologies for End
User Devices containing PHI;and
• Any other State or Federal law, regulation, or administrative rule relating to the specific HHS
program area that CONTRACTOR supports on behalf of HHS.
ARTICLE 4. BREACH NOTICE,REPORTING AND CORRECTION REQUIREMENTS
Section 4.01. Breach or Event Notification to HHS. 45 CFR 164.400-414
(A) CONTRACTOR will cooperate fully with HHS in investigating, mitigating to the extent
practicable and issuing notifications directed by HHS, for any Event or Breach of Confidential
Information to the extent and in the manner determined by HHS.
(B) CONTRACTOR'S obligation begins at the Discovery of an Event or Breach and
continues as long as related activity continues, until all effects of the Event are mitigated to
HHS's satisfaction(the "incident response period").45 CFR 164.404
(C) Breach Notice:
1. Initial Notice.
a. For federal information, including without limitation, Federal Tax Information, Social Security
Administration Data, and Medicaid Client Information, within the first, consecutive clock hour
of Discovery, and for all other types of Confidential Information not more than 24 hours after
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Discovery, or in a timeframe otherwise approved by HHS in writing, initially report to HHS's
Privacy and Security Officers via email at: privacy@HHSC.state.tx.us and to the HHS division
responsible for this DUA; and IRS Publication 1075; Privacy Act of 1974, as amended by the
Computer Matching and Privacy Protection Act of 1988, 5 U.S.C. §552a; OMB Memorandum
07-16 as cited in HHSC-CMS Contracts for information exchange.
b. Report all information reasonably available to CONTRACTOR about the Event or Breach of
the privacy or security of Confidential Information. 45 CFR 164.410
c. Name, and provide contact information to HHS for, CONTRACTOR's single point of contact
who will communicate with HHS both on and off business hours during the incident response
period.
2. 48-Hour Formal Notice. No later than 48 consecutive clock hours after Discovery, or a
time within which Discovery reasonably should have been made by CONTRACTOR of an Event
or Breach of Confidential Information, provide formal notification to the State, including all
reasonably available information about the Event or Breach, and CONTRACTOR's investigation,
including without limitation and to the extent available: For(a) - (m) below: 45 CFR 164.400-
414
a.The date the Event or Breach occurred;
b. The date of CONTRACTOR's and, if applicable, Subcontractor's Discovery;
c. A brief description of the Event or Breach; including how it occurred and who is responsible
(or hypotheses, if not yet determined);
d.A brief description of CONTRACTOR's investigation and the status of the investigation;
e. A description of the types and amount of Confidential Information involved;
f. Identification of and number of all Individuals reasonably believed to be affected, including
first and last name of the individual and if applicable the, Legally authorized representative, last
known address, age, telephone number, and email address if it is a preferred contact method, to
the extent known or can be reasonably determined by CONTRACTOR at that time;
g. CONTRACTOR's initial risk assessment of the Event or Breach demonstrating whether
individual or other notices are_required by applicable law or this DUA for HHS approval,
including an analysis of whether there is a low probability of compromise of the Confidential
Information or whether any legal exceptions to notification apply;
h. CONTRACTOR's recommendation for HHS's approval as to the steps Individuals and/or
CONTRACTOR on behalf of Individuals, should take to protect the Individuals from potential
harm, including without limitation CONTRACTOR's provision of notifications, credit protection,
claims monitoring, and any specific protections for a Legally Authorized Representative to take
on behalf of an Individual with special capacity or circumstances;
i. The steps CONTRACTOR has taken to mitigate the harm or potential harm caused (including
without limitation the provision of sufficient resources to mitigate);
j. The steps CONTRACTOR has taken, or will take, to prevent or reduce the likelihood of
recurrence of a similar Event or Breach;
k. Identify,describe or estimate of the Persons,Workforce, Subcontractor,or Individuals and any
law enforcement that may be involved in the Event or Breach;
1. A reasonable schedule for CONTRACTOR to provide regular updates to the foregoing in the
future for response to the Event or Breach, but no less than every three (3) business days or as
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otherwise directed by HHS, including information about risk estimations, reporting, notification,
if any, mitigation, corrective action, root cause analysis and when such activities are expected to
be completed;and
m. Any reasonably available, pertinent information, documents or reports related to an Event or
Breach that HHS requests following Discovery.
Section 4.02 Investigation,Response and Mitigation. For A-F below: 45 CFR 164.308, 310
and 312;164.530
(A) CONTRACTOR will immediately conduct a full and complete investigation, respond to
the Event or Breach, commit necessary and appropriate staff and resources to expeditiously
respond, and report as required to and by HHS for incident response purposes and for purposes of
HHS's compliance with report and notification requirements,to the satisfaction of HHS.
(B) CONTRACTOR will complete or participate in a risk assessment as directed by HHS
following an Event or Breach, and provide the final assessment, corrective actions and
mitigations to HHS for review and approval.
(C) CONTRACTOR will fully cooperate with HHS to respond to inquiries and/or
proceedings by state and federal authorities, Persons and/or Individuals about the Event or
Breach.
(D) CONTRACTOR will fully cooperate with HHS's efforts to seek appropriate injunctive
relief or otherwise prevent or curtail such Event or Breach, or to recover or protect any
Confidential Information, including complying with reasonable corrective action or measures, as
specified by HHS in a Corrective Action Plan if directed by HHS under the Base Contract.
Section 4.03 Breach Notification to Individuals and Reporting to Authorities. Tex. Bus. &
Comm. Code§521.053;45 CFR 164.404(Individuals), 164.406(Media);164.408(Authorities)
(A) HHS may direct CONTRACTOR to provide Breach notification to Individuals,
regulators or third-parties,as specified by HHS following a Breach.
(B) CONTRACTOR must obtain HHS's prior written approval of the time, manner and
content of any notification to Individuals, regulators or third-parties, or any notice required by
other state or federal authorities. Notice letters will be in CONTRACTOR's name and on
CONTRACTOR's letterhead, unless otherwise directed by HHS, and will contain contact
information, including the name and title of CONTRACTOR's representative, an email address
and a toll-free telephone number,for the Individual to obtain additional information.
(C) CONTRACTOR will provide HHS with copies of distributed and approved
communications.
(D) CONTRACTOR will have the burden of demonstrating to the satisfaction of HHS that
any notification required by HHS was timely made. If there are delays outside of
CONTRACTOR's control, CONTRACTOR will provide written documentation of the reasons
for the delay.
(E) If HHS delegates notice requirements to CONTRACTOR, HHS shall, in the time and
manner reasonably requested by CONTRACTOR, cooperate and assist with CONTRACTOR's
information requests in order to make such notifications and reports.
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ARTICLE 5. SCOPE OF WORK
Scope of Work means the services and deliverables to be performed or provided by
CONTRACTOR,or on behalf of CONTRACTOR by its Subcontractors or agents for HHS that are described
in detail in the Base Contract. The Scope of Work, including any future amendments thereto, is incorporated
by reference in this DUA as if set out word-for-word herein.
ARTICLE 6. GENERAL PROVISIONS
Section 6.01 Ownership of Confidential Information
CONTRACTOR acknowledges and agrees that the Confidential Information is and will remain the
property of HHS. CONTRACTOR agrees it acquires no title or rights to the Confidential Information.
Section 6.02 HHS Commitment and Obligations
HHS will not request CONTRACTOR to create, maintain, transmit, use or disclose PHI in any manner
that would not be permissible under applicable law if done by HHS.
Section 6.03 HHS Right to Inspection
At any time upon reasonable notice to CONTRACTOR,or if HHS determines that CONTRACTOR
has violated this DUA,HHS,directly or through its agent,will have the right to inspect the facilities,systems,
books and records of CONTRACTOR to monitor compliance with this DUA. For purposes of this
subsection,HHS's agent(s)include,without limitation,the HHS Office of the Inspector General or the Office
of the Attorney General of Texas,outside consultants or legal counsel or other designee.
Section 6.04 Term; Termination of DUA;Survival
This DUA will be effective on the date on which CONTRACTOR executes the DUA, and will
terminate upon termination of the Base Contract and as set forth herein . If the Base Contract is extended or
amended,this DUA is updated automatically concurrent with such extension or amendment.
(A) HHS may immediately terminate this DUA and Base Contract upon a material violation
of this DUA.
(B) Termination or Expiration of this DUA will not relieve CONTRACTOR of its obligation
to return or Destroy the Confidential Information as set forth in this DUA and to continue to safeguard the
Confidential Information until such time as determined by HHS.
(D) If HHS determines that CONTRACTOR has violated a material term of this DUA; HHS
may in its sole discretion:
1. Exercise any of its rights including but not limited to reports, access and inspection under
this DUA and/or the Base Contract; or
2. Require CONTRACTOR to submit to a corrective action plan, including a plan for
monitoring and plan for reporting, as HHS may determine necessary to maintain compliance with
this DUA; or
3. Provide CONTRACTOR with a reasonable period to cure the violation as determined
by HHS;or
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4. Terminate the DUA and Base Contract immediately, and seek relief in a court of
competent jurisdiction in Travis County,Texas.
Before exercising any of these options, HHS will provide written notice to CONTRACTOR
describing the violation and the action it intends to take.
(E) If neither termination nor cure is feasible, HHS shall report the violation to the Secretary.
(F) The duties of CONTRACTOR or its Subcontractor under this DUA survive the expiration or
termination of this DUA until all the Confidential Information is Destroyed or returned to HHS, as
required by this DUA.
Section 6.05 Governing Law, Venue and Litigation
(A) The validity,construction and performance of this DUA and the legal relations among the
Parties to this DUA will be governed by and construed in accordance with the laws of the State of Texas.
(B) The Parties agree that the courts of Travis County, Texas, will be the exclusive venue for
any litigation, special proceeding or other proceeding as between the parties that may be brought, or arise
out of, or in connection with,or by reason of this DUA.
Section 6.06 Injunctive Relief
(A) CONTRACTOR acknowledges and agrees that HHS may suffer irreparable injury if
CONTRACTOR or its Subcontractor fails to comply with any of the terms of this DUA with respect to
the Confidential Information or a provision of HIPAA or other laws or regulations applicable to
Confidential Information.
(B) CONTRACTOR further agrees that monetary damages may be inadequate to compensate
HI-IS for CONTRACTOR's or its Subcontractor's failure to comply. Accordingly, CONTRACTOR
agrees that HHS will, in addition to any other remedies available to it at law or in equity, be entitled to
seek injunctive relief without posting a bond and without the necessity of demonstrating actual damages,
to enforce the terms of this DUA.
Section 6.07 Indemnification
To the extent permitted by law, CONTRACTOR will indemnify, defend and hold harmless HI-IS and its
respective Executive Commissioner,employees, Subcontractors,agents(including other state agencies acting
on behalf of HHS) or other members of its Workforce (each of the foregoing hereinafter referred to as
"Indemnified Party")against all actual and direct losses suffered by the Indemnified Party and all liability to
third parties arising from or in connection with any breach of this DUA or from any acts or omissions related
to this DUA by CONTRACTOR or its employees, directors, officers, Subcontractors, or agents or other
members of its Workforce. The duty to indemnify, defend and hold harmless is independent of the duty to
insure and continues to apply even in the event insurance coverage required, if any, in the DUA or Base
Contract is denied,or coverage rights are reserved by any insurance carrier. Upon demand,CONTRACTOR
will reimburse HI-IS for any and all losses,liabilities,lost profits,fines,penalties,costs or expenses(including
reasonable attorneys' fees)which may for any reason be imposed upon any Indemnified Party by reason of
any suit, claim, action, proceeding or demand by any third party to the extent caused by and which results
from the CONTRACTOR's failure to meet any of its obligations under this DUA. To the extent permitted by
law, CONTRACTOR's obligation to defend, indemnify and hold harmless any Indemnified Party will
survive the expiration or termination of this DUA.
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Section 6.08 Insurance
(A) CONTRACTOR represents and warrants that it maintains either self-insurance or
commercial insurance with policy limits sufficient to cover any liability arising from any acts or
omissions by CONTRACTOR or its employees, directors, officers, Subcontractors, or agents or other
members of its Workforce under this DUA. CONTRACTOR warrants that HHS will be a loss payee and
beneficiary of any such claims.
(B) CONTRACTOR will provide HHS with written proof that required insurance coverage is
in effect,at the request of HHS.
Section 6.09 Fees and Costs
Except as otherwise specified in this DUA or the Base Contract, including but not limited to
requirements to insure and/or indemnify HHS, if any legal action or other proceeding is brought for the
enforcement of this DUA, or because of an alleged dispute, contract violation, Event, Breach, default,
misrepresentation,or injunctive action, in connection with any of the provisions of this DUA,each party will
bear their own legal expenses and the other cost incurred in that action or proceeding.
Section 6.10 Entirety of the Contract
This Data Use Agreement is incorporated by reference into the Base Contract and,together with the
Base Contract, constitutes the entire agreement between the parties. No change, waiver, or discharge of
obligations arising under those documents will be valid unless in writing and executed by the party against
whom such change,waiver,or discharge is sought to be enforced.
Section 6.11 Automatic Amendment and Interpretation
Upon the effective date of any amendment or issuance of additional regulations to HIPAA, or any
other law applicable to Confidential Information, this DUA will automatically be amended so that the
obligations imposed on HHS and/or CONTRACTOR remain in compliance with such requirements. Any
ambiguity in this DUA will be resolved in favor of a meaning that permits HHS and CONTRACTOR to
comply with HIPAA or any other law applicable to Confidential Information.
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ATTACHMENT 1. SUBCONTRACTOR AGREEMENT FORM
HHS CONTRACT NUMBER
The DUA between HHS and CONTRACTOR establishes the permitted and required uses and disclosures
of Confidential Information by CONTRACTOR.
CONTRACTOR has subcontracted with
(SUBCONTRACTOR)for performance of duties on behalf of CONTACTOR which are subject to the
DUA. SUBCONTRACTOR acknowledges,understands and agrees to be bound by the identical terms
and conditions applicable to CONTRACTOR under the DUA, incorporated by reference in this
Agreement,with respect to HHS Confidential Information. CONTRACTOR and SUBCONTRACTOR
agree that HHS is a third-party beneficiary to applicable provisions of the subcontract.
HHS has the right but not the obligation to review or approve the terms and conditions of the subcontract
by virtue of this Subcontractor Agreement Form.
CONTRACTOR and SUBCONTRACTOR assure HHS that any Breach or Event as defined by the DUA
that SUBCONTRACTOR Discovers will be reported to HHS by CONTRACTOR in the time,manner
and content required by the DUA.
If CONTRACTOR knows or should have known in the exercise of reasonable diligence of a pattern of
activity or practice by SUBCONTRACTOR that constitutes a material breach or violation of the DUA or
the SUBCONTRACTOR's obligations CONTRACTOR will:
1. Take reasonable steps to cure the violation or end the violation,as applicable;
2. If the steps are unsuccessful,terminate the contract or arrangement with SUBCONTRACTOR,if
feasible;
3. Notify HHS immediately upon reasonably discovery of the pattern of activity or practice of
SUBCONTRACTOR that constitutes a material breach or violation of the DUA and keep HHS
reasonably and regularly informed about steps CONTRACTOR is taking to cure or end the
violation or terminate SUBCONTACTOR's contract or arrangement.
This Subcontractor Agreement Form is executed by the parties in their capacities indicated below.
CONTRACTOR SUBCONTRACTOR
BY: BY: C---- 1'
NAME: NAME:
TITLE: TITLE:
DATE ,201 . DATE:
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