General, Tax Refund, and Payroll Disbursement and Custody Services

MARYLAND STATE TREASURER’S OFFICE (STO)
REQUEST FOR PROPOSALS (RFP)
GENERAL, TAX REFUND, AND PAYROLL
DISBURSEMENT AND CUSTODY SERVICES

RFP # DISB -06232025

ISSUE DATE: JUNE 23, 2025
NOTICE TO OFFERORS
The State Treasurer’s Office strongly encourages MBE participation in all its
solicitations, especially when there is/are no stated goal(s). To the extent that MBEs
employed in this industry are interested but are not fully qualified to respond,
please contact the Procurement Officer listed on the Key Information Summary
Sheet for further information.

A Prospective Offeror that has received this document from a source other than eMarylandMarketplace
(eMMA) https://procurement.maryland.gov should register on eMMA. See Section 4.2 .

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VENDOR FEEDBACK FORM
To help us improve the quality of State solicitations, and to make our procurement process more
responsive and business friendly, please provide comments and suggestions regarding this solicitation.
Please return your comments with your response. If you have chosen not to respond to this solicitation,
please email or fax this completed form to the attention of the Procurement Officer (see Key
Information Summary Sheet below for contact information).
Title: General, Tax Refund, and Payroll Disbursement and Custody Services
Solicitation No: RFP#DISB -06232025
1. If you have chosen not to respond to this solicitation, please indicate the reason(s) below:
□ Other commitments preclude our participation at this time
□ The subject of the solicitation is not something we ordinarily provide
□ We are inexperienced in the work/commodities required
□ Specifications are unclear, too restrictive, etc. (Explain in REMARKS section)
□ The scope of work is beyond our present capacity
□ Doing business with the State is simply too complicated. (Explain in REMARKS section)
□ We cannot be competitive. (Explain in REMARKS section)
□ Time allotted for completion of the Proposal is insufficient
□ Start -up time is insufficient
□ Bonding/Insurance requirements are restrictive (Explain in REMARKS section)
□ Proposal requirements (other than specifications) are unreasonable or too risky (Explain in
REMARKS section)
□ MBE or VSBE requirements (Explain in REMARKS section)
□ Prior State of Maryland contract experience was unprofitable or otherwise unsatisfactory.
(Explain in REMARKS section)
□ Payment schedule too slow
□ Other:
2. If you have submitted a response to this solicitation, but wish to offer suggestions or express
concerns, please use the REMARKS section below. (Attach additional pages as needed.)
REMARKS:

Vendor Name: Date:

Contact Person: Phone ( ) -

Address:

E-mail Address:

General, Tax Refund, and Payroll Disbursement and Custody Services
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MARYLAND STATE TREASURER’S OFFICE (STO)
KEY INFORMATION SUMMARY SHEET
Request for Proposals GENERAL, TAX REFUND, AND PAYROLL
DISBURSEMENT AND CUSTODY SERVICES
Solicitation Number: RFP#DISB -06232025
RFP Issue Date: Monday June 23, 2025
RFP Issuing Office: Maryland State Treasurer’s Office (STO or the "Office")
Procurement Officer: Kris Chewlin
80 Calvert Street, Room 109
Annapolis, Maryland 21401
e-mail:
Office Phone: kchewlin@treasurer.state.md.us
410-260-7428
Proposals are to be sent to: eMMA Portal or via Trackable Mail or Hand Delivery (PLEASE
NOTE THAT DELIVERY via the eMMA PORTAL IS HIGHLY
PREFERRED)
Pre-Proposal Conference: There will not be a Pre-Proposal Conference for this Procurement
Questions Due Date and Time Monday J uly 14, 2025 at 4PM EST
Proposal Due (Closing) Date
and Time: Monday August 11, 2025 at 4PM EST
Offerors are reminded that a completed Feedback Form is requested
if a no-bid d ecision is made (see page ii).
Oral Presentations (for short -
listed offerors) During the weeks of August 25 – September 4 , 2025 at the STO’s
location in Annapolis MD.
MBE Subcontracting Goal: There are no MBE goals related to this RFP.
VSBE Subcontracting Goal: There are no VSBE goals related to the RFP.
Contract Type: Indefinite quantity with fixed unit prices.
Contract Duration: Five (5) Year base period with two (2) two-year renewal options.
Primary Place of
Performance: Annapolis, Maryland
SBR Designation: No
Federal Funding: No

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TABLE OF CONTENTS – RFP
1 Minimum Qualifications ....................................................................................................................... 1
1.1 Purpose ........................................................................................................................................ 1
1.2 Offeror Minimum Requirements .................................................................................................. 1
2 Contractor Requirements: Scope of Work ......................................................................................... 3
CATEGORY A – GENERAL, TAX REFUND, AND PAYROLL DISBURSEMENT SERVICES ..... 3
2.1 Summary ...................................................................................................................................... 3
2.2 Order of Precedence ..................................................................................................................... 3
2.3 Background of Current Banking Structure ................................................................................... 4
CATEGORY B – CUSTODY SERVICES ........................................................................................... 33
2.4 Background for Custody Services .............................................................................................. 33
3 Contractor Requirements: General .................................................................................................. 46
3.1 Contract Initiation Requirements ............................................................................................... 46
3.2 End of Contract Transition ......................................................................................................... 46
3.3 Invoicing .................................................................................................................................... 46
3.4 Liquidated Damages .................................................................................................................. 47
3.5 Disaster Recovery and Data ....................................................................................................... 47
3.6 Insurance Requirements ............................................................................................................. 48
3.7 Security Requirements ............................................................................................................... 49
3.8 SOC 2 Type 2 Audit Report ....................................................................................................... 50
3.9 Key Personnel ............................................................................................................................ 51
3.10 Substitution of Personnel ........................................................................................................... 52
3.11 Work Orders .............................................................................................................................. 52
3.12 Additional Clauses ..................................................................................................................... 52
4 Procurement Instructions ................................................................................................................... 53
4.1 Pre-Proposal Conference ............................................................................................................ 53
4.2 eMaryland Marketplace Advantage (eMMA) ............................................................................ 53
4.3 Questions ................................................................................................................................... 53
4.4 Procurement Method .................................................................................................................. 53
4.5 Proposal Due (Closing) Date and Time ..................................................................................... 53
4.6 Multiple or Alternate Proposals ................................................................................................. 54
4.7 Economy of Preparation ............................................................................................................. 54

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4.8 Public Information Act Notice ................................................................................................... 54
4.9 Award Basis ............................................................................................................................... 54
4.10 Oral Presentation ........................................................................................................................ 54
4.11 Duration of Proposal .................................................................................................................. 54
4.12 Revisions to the RFP .................................................................................................................. 54
4.13 Cancellations .............................................................................................................................. 55
4.14 Incurred Expenses ...................................................................................................................... 55
4.15 Protest/Disputes ......................................................................................................................... 55
4.16 Offeror Responsibilities ............................................................................................................. 55
4.17 Acceptance of Terms and Conditions ........................................................................................ 56
4.18 Proposal Affidavit ...................................................................................................................... 56
4.19 Contract Affidavit ...................................................................................................................... 56
4.20 Compliance with Laws/Arrearages ............................................................................................ 56
4.21 Verification of Registration and Tax Payment ........................................................................... 56
4.22 False Statements ......................................................................................................................... 56
4.23 Payments by Electronic Funds Transfer ..................................................................................... 57
4.24 Prompt Payment Policy .............................................................................................................. 57
4.25 Electronic Procurements Authorized ......................................................................................... 57
4.26 MBE Participation Goal ............................................................................................................. 59
4.27 VSBE Goal................................................................................................................................. 59
4.28 Living Wage Requirements ....................................................................................................... 59
4.29 Federal Funding Acknowledgement .......................................................................................... 60
4.30 Non-Disclosure Agreement ........................................................................................................ 60
4.31 HIPAA - Business Associate Agreement ................................................................................... 60
4.32 Nonvisual Access ....................................................................................................................... 60
4.33 Location of the Performance of Services Disclosure ................................................................. 60
4.34 Department of Human Services (DHS) Hiring Agreement ........................................................ 61
4.35 Small Business Reserve (SBR) Procurement ............................................................................. 61
4.36 Maryland Healthy Working Families Act Requirements ........................................................... 61
5 Proposal Format ................................................................................................................................. 62
5.1 Two Part Submission ................................................................................................................. 62
5.2 Proposal Delivery and Packaging .............................................................................................. 62
5.3 Volume I - Technical Proposal .................................................................................................. 63
5.4 Volume II – Financial Proposal ................................................................................................. 67
6 Evaluation and Selection Process ...................................................................................................... 68

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6.1 Evaluation Committee ............................................................................................................... 68
6.2 Technical Proposal Evaluation Criteria ...................................................................................... 68
6.3 Financial Proposal Evaluation Criteria ...................................................................................... 68
6.4 Selection Procedures .................................................................................................................. 68
6.5 Award Determination ................................................................................................................. 69
7 RFP ATTACHMENTS AND APPENDICES
Attachment A. Financial Proposal Instructions & Form .................................................................. 70
Attachment B. Proposal Affidavit ....................................................................................................... 72
Attachment C. Maryland Living Wage Affidavit of Agreement for Service Contracts ................. 73
Attachment D. Conflict of Interest Affidavit and Disclosure ............................................................ 75
Attachment E. Contract ....................................................................................................................... 76
Attachment F. Contract Affidavit ....................................................................................................... 89
Attachment G. Collateral Security Agreement .................................................................................. 90
Attachment H. Designation of Depository .......................................................................................... 90
Appendix 1. – Abbreviations and Definitions ......................................................................................... 96
Appendix 2. – Section 6 -201(e) of the State Finance and Procurement Article of the Annotated
Code of Maryland ............................................................................................................................... 98
Appendix 3. – Section 6 -202 of the State Finance and Procurement Article of the Annotated Code
of Maryland ............................................................................................................................................... 99
Appendix 4. – Section 6 -209 of the State Finance and Procurement Article of the Annotated Code
of Maryland ............................................................................................................................................. 101
Appendix 5. – Section 6 -222 of the State Finance and Procurement Article of the Annotated Code
of Maryland ....................................................................................................................................... 102
Appendix 6. – Section 6 -203 of the State Finance and Procurement Article of the Annotated Code
of Maryland ....................................................................................................................................... 105
Appendix 7. – Section 6 -210 of the State Finance and Procurement Article of the Annotated Code
of Maryland ....................................................................................................................................... 106

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1 Minimum Qualifications
1.1 Purpose
The Maryland State Treasurer's Office (“STO” or, the “Office”) is responsible for the deposits, investment
and disbursements of funds into or out of the State Treasury. STO is the issuer of this RFP and is requesting
proposals from a financial institution to provide (a) banking disbursement services of State funds
(CATEGORY A); and (b) custody services for the State’s investment securities (CATEGORY B).
Offerors MUST bid on both categories to be considered for award . It is STO’s intent to make one
contract award for both categories.
STO will accept proposals from Offerors who choose to partner with another financial institution
under separate, subcontract agreement for Categor ies A and/ or B. The subcontracted institution must
meet the Minimum Requirements stated below. Each proposal must clearly identify who the Offeror
(Prime) is and who the sub-contractor is (if applicable). One contract award will be presented to the
chosen Offeror.

1.2 Offeror Minimum Requirements

As part of the determination to be considered reasonably susceptible of being selected for award, each
Offeror shall specifically and clearly state in its proposal that it meets the requirements in this section. The
minimum requirements are for both the disbursement services and custody services, unless otherwise
specified. Failure to do so may result in the rejection of the proposal by the Procurement Officer.
1.2.1 The Offeror is a financial institution as defined in Section 6 -201(e) of the State Finance
and Procurement Article of the Annotated Code of Maryland (Appendix 2).
1.2.2 The Offeror must be certified by or a member in compliance with the Federal Deposit Insurance Corporation (“FDIC”).
1.2.3 The Offeror must have and maintain for the duration of the Contract, a Kroll Bond Rating
Agency (“KBRA”) rating, or a similar financial strength rating from a nationally
recognized statistical rating organization (NSRO) of at least a "B-"or alternatively, an IDC
Financial Publishing, Inc. numerical performance rating/grade of at least a “158” for the
duration of this Contract (and/or) effective services rendered by the State Treasurer’s Office (STO). Should the Offeror’s rating drop below a “B -“or “158”, the STO may
dismiss the Offeror, require additional collateral of the Offeror, or take other actions to
protect State funds and the interest of the State of Maryland at the sole discretion of the Treasurer or Treasurer’s Designee.
1.2.4 The Offeror must have the ability to clear transactions or cash through all major book entry or electronic securities depositories, such as the DTC/ID system and the Federal Reserve System.
1.2.5 The Offeror must actively hold membership with the National Automated Clearing House
Association (NACHA) and strictly adhere to its rules, guidelines, and procedures.
Additionally, upon request by the STO, the Offeror must promptly provide a plan of action
within fifteen (15) business days to address and implement any necessary or proposed
fraud and risk- related changes mandated by the National Automated Clearing House
Association (NACHA). The Offeror must have a plan for business continuity and recovery
as a result of disaster, cybersecurity breach, internal embezzlement, etc.

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1.2.6 The Offeror must provide for the collateralization of all funds in accounts in accordance
with the requirements set forth in Sections 6 -202, 6- 209, and 6- 222 of the State Finance
and Procurement Article. (See Appendix 3, 4, and 5). Except as required or pe rmitted
under §6- 202 with respect to surety bonds or letters of credit provided as collateral shall
be on deposit in the name of the State of Maryland, either with (a) the Federal Reserve
Bank of Boston, or (b) at the sole discretion of the Treasurer, on deposit with an
independent financial institution acceptable to the Treasurer. The Offeror must agree to
conform to all FDIC guidelines on collateral to ensure clear title to all collateral held will
rest with the Treasurer in the event of default. All costs associated with the placement of
this collateral will be the responsibility of the Offeror.
1.2.7 The Offeror must provide a robust and secure electronic portal or online tool, ensuring
seamless access to an advanced treasury system and platform. This tool should offer
interactive viewing, processing and reporting of Banking and Custody activity for th e
State.
1.2.8 The Offeror must provide electronically, in an agreed upon format, by the tenth of the
subsequent month, reports on account balances and collateral in accordance with
requirements set forth in § 6- 210 (Appendix 7).
1.2.9 The Offeror must electronically report, in an agreed upon format, interest earnings
transferred to the Office, by the tenth of the subsequent month.
1.2.10 The Offeror must have an independent certified public accounting firm perform a
comprehensive audit of its financial statements and receive an unqualified opinion
certifying the Offeror’s financial position in accordance with applicable financial industry
performance standards. Proof of audit and opinion must be submitted via secure email to
bankingcollateral@treasurer.state.md.us by April 15th each calendar year.
1.2.11 The Offeror is required to procure an industry standard and comprehensive SOC 2, Type
2 Banking Compliance report annually from an external or independent source or party and must cover the entirety of the previous calendar year. The Offeror is required to
deliver the results of the comprehensive SOC 2, Type 2 Compliance report certification
from the audit firm which must include the period of the audit, a list of any exposed
vulnerabilities and/or deficiencies found, and what remedial action is being taken to
address the issues. The State reserves the right to receive additional information including
the full report upon written request. The results shall be distributed to the STO no later than October 15
th each calendar year by secure email to
bankingcollateral@treasurer.state.md.us with a copy to the Procurement Officer.
1.2.12 The Offeror must provide customer support in English and Spanish languages.
1.2.13 Disbursements Services Specific - The State requires the Offeror to honor all checks,
ACH, and wires during overnight and daylight account overdraft within one business day.
1.2.14 Disbursements Services Specific - All bank fees and charges incurred or assessed for
each disbursement account must be itemized and furnished to the applicable State agency
via an electronic or downloadable statement/invoice for services rendered. The Offeror
must not assess, charge, or automatically debit any disbursement account for bank fees or
charges.
1.2.15 Disbursements Services Specific – Each disbursement account established under this
Contract must default to receive earnings income credit. The monthly earnings income
credit rate must be itemized clearly on each month’s statement/invoice.

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2 Contractor Requirements: Scope of Work
CATEGORY A
GENERAL, TAX REFUND, AND PAYROLL DISBURSEMENT SERVICES
2.1 Summary
The requirements include the establishment and maintenance of State accounts for disbursement services,
and the accurate and timely processing of all statewide banking services related to the accounts including,
but not limited to; controlled disbursement, payee positive pay, zero balance sweep accounts, banking API
integration, earnings income credit rate, bank reconciliation for all disbursement accounts including
Automated Return of Payment (ARP), Account Validation services (AVS), ACH debit blocks, ACH fraud
controls, ACH Pre -note processing, ACH origination capabilities, access to the bank’s Web -based Portal
System to complete transaction inquiries and research (i.e. account detail/summary look ups, pre -note
failures, paid check images, outstanding checks and transaction detail information) and the ability to
process transactions (i.e. check stops and wires) along with a variety of electronic reporting and communication needs.

Below is a summary list of banking services, not necessarily all inclusive, that will be required for consideration of an award.

• Government Online Banking Fraud Controls
Controlled Disbursement, Payee Positive Pay, Account Validation Services

• Large Batch Data File Transmittals
Electronic file sending and receiving capability through Secure File Transmission
Protocol (SFTP)

• Account Reconciliation, Online ACH Maintenance/Research Request Options, &
Online Itemized Reporting Services
Electronic copy of ACH activity reconciliation reports (detail and summary
information);
Daily, Interim -Day and Monthly Electronic bank statements (itemized detail and
transaction summary information)

• ACH Origination and Online ACH Submission Request

• Next Day Online Check Imaging & Online Check Maintenance/Research Request
Options
Online expedited next day viewing of paid check images
Online tool to expeditiously submit stop payment requests on pending checks to be presented;
these stop payments must be effective on the same business day as submission.

2.2 Order of Precedence

The Contract between the parties will be embodied in the Contract documents which will consist of the
following, listed in their order of precedence:

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1. the executed Contract;
2. the RFP; and
3. the Offeror's proposal.

The Office will not accept any modifications to the order of precedence provision of this solicitation.

2.3 Background of Current Banking Structure
The State’s current Disbursement banking structure consists of the Main Disbursement account with the
following accounts tied to it:

1) ZBA arrangement: Controlled Disbursement: Vendor account
2) ZBA arrangement: Payroll, MTA Payroll, RAD Income Tax, and RAD Quick Pay
3) RAD SITLP is a stand -alone bank account
4) MSRPS checks and ACH payments are facilitated by the Treasurer’s Office on MSRPS’
behalf. This account is not tied to Treasurer’s Office banking structure.

The STO reserves the right to consolidate, increase and decrease the number of accounts and the payment
types issued from these accounts during the contract term.

2.3.1 Main Disbursement Account
Cash is managed at the Main Disbursement account level. Daily collected balances are
transferred from the State’s depository services provider to the Main Disbursement account. The various
disbursement accounts receive automatic funding from the Main Disbursement account.

For the purposes of this Contract, “local time” shall be defined as Eastern Standard Time as observed by
Annapolis, Maryland.

Currently, the STO Investment Division utilizes the bank’s online system to access the cash position, which includes the first presentment/cleared checks, by 7:00 a.m. local time. The second
presentment/cleared checks are accessed by 8:30 local time. A daily threshold balance of $15 mi llion is
maintained to accommodate any variances in the check clearing estimates. This daily threshold balance
is solely determined by STO, and changes (increases/decreases) based on STO business operations.

There are multiple days during the fiscal year when the State’s vendor disbursements exceed $3.5 billion,
and $2.0 billion disbursement days are frequent. It is important to note that the disbursement account
will be funded on the settlement date (versus the transmission date of the ACH file).

ACH transactions are issued in the CCD+ format with an addendum record, CTX format with an
addendum record or EDI format.

Forms of disbursement FedWire and S.W.I.F.T.
Monthly volume of incoming wires 50
Monthly volume of outgoing wires 100
Average monthly vendor ACH volume 35,000

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Brief Description of Vendor Disbursement Services

Forms of disbursement Checks
Average monthly vendor check volume 75,000
Average monthly stop payment volume 650

The Treasurer’s Office utilizes a full Account Reconciliation Process semi -monthly with daily paid
electronic files of all items. A web -based stop payment system is used.

2.3.2 Brief Description of the Income Tax Refund Disbursement Services
These accounts are associated with the disbursement of State Income Tax Refunds resulting from over
payments by individuals, corporations, and fiduciaries.
Tax-General Article, Titles 1, 2, 10 and 13 of the Annotated Code of Maryland, provide for the State
income tax on individuals, corporations, and fiduciaries. Additionally, they provide for the local income
tax on individuals, which is imposed by the twenty -three counties and Baltimore City and is collected by
the Comptroller of Maryland, Revenue Administration Division (the “Division”). The local income tax is
shared with the incorporated municipalities. The Division is also responsible to the taxpayers to return those funds paid to the Division through the payroll deduction and/or quarterly tax payments that are not
due the State through the filing of a vali d tax return.

Checks and ACH credit entries are drawn from these accounts for tax refund payments only. ACH entries
will use the National Automated Clearing House’s ACH record format specifications for PPD. The account
is funded from the Treasurer’s Main Disbursement account. Additionally, disbursements to the federal
government are made in connection with a tax intercept program (SITLP).

The State maintains three separate disbursement accounts to facilitate the tax refund process:

a. The first account is designated for issuing refund checks and direct deposits processed on a routine
basis. Ideally, this account will be funded as the ACH’s and checks clear.
b. The second account is allocated for disbursing emergency payments, commonly referred to as
“quick pay” checks. In most cases, these checks involve fewer than 100 transactions per year.
Ideally, this account will be funded as checks clear.
c. The third account is reserved for the IRS tax liability offset program (SITLP), which permits the
IRS to directly debit an account. This account is funded by a wire transfer from the State’s Main
Disbursement account.

Annual checks issue file for income tax
refunds transmission 405,000
Annual ACH transactions initiated for
income tax refunds 1,960,000
Other activity on income tax refund account
(annual volumes):
Stop payments 200

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Requested copies/images of paid items 500
Returned items (failed direct deposits) 47,500
Quick checks 150

2.3.3 Income Tax Refund Disbursement Services Requirements
Please indicate your compliance with the following requirements in your proposal. Indicate compliance
with a “YES” if you meet the requirement or “NO” if you do not meet the requirement. You may
also supply brief supporting statements.
• The Offeror must allow for a limited number (state number in bid) of emergency telephone stop payment request with confirmation the same day of request.
• The Offeror must credit the account within 24 hours after receipt from the State of an affidavit certifying that the endorsement on an item is a forgery.
• The Offeror must render complete bank reconciliations within ten (10) days of the end of the period. Generally, a period will be ten (10) days twice a month. These reconciliations are intended
to be a full ARP. Completed reconciliations should include all maintenance reports used during
the reconciliation period, including a list of corrected check serial numbers of rejected checks.
• The Offeror must provide legible images of items, including clear checks within 8 business hours
of the request. Request for items over two years old must be provided within 72 hours of the
request
• The Offeror hereby acknowledges and agrees that in the case of rejection of any ACH & Direct Deposit disbursement payments by the intended financial institution, upon the Offeror's generation
of an ACH & Direct Deposit report that reflects the details of the rejected transactions, encompassing transaction dollar amounts and payee information, payment number, transaction
number, Employee ID number, the Offeror is legally obligated to promptly ensure the return and
crediting of funds to the initiating disbursement account within one business day of acknowledging the rejected ACH & Direct Deposit truncations. This adherence to timely fund restitution serves
as a binding commitment and obligation of the Offeror under the terms of this contract.
• All ACH failures/returns must be accessible through the Offeror’s online banking platform/system
by 6:00 a.m. local time on the subsequent business day after receiving the failure notification from
the receiving bank. The Offeror is required to generate a distinct 'Custom Report' exclusively for
ACH failures/returns for each Agency separately. This segregated 'Custom Report' for each
agency individually should be readily available on Offeror’s online banking platform/system every
business day.
• All successful Pre-notes and Pre-note Failures must be accessible via the Offeror’s online banking
platform/system by 6:00 a.m. local time the following business day after the Pre-note response is
received. Access to the online banking platform/system are to give online users the ability to search, view, print and download/save all successful Pre-notes and Pre-note Failures in Microsoft
Excel and Adobe .pdf formats.
Details are to include the following:

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• Bank Account Number
• Receiver bank account number
• ACH Issuance date
• ACH return reason code
• ACH return reason description
• ACH return tracer id
• Payee Name
• Vendor Payment Number
• Individual Name/ID Number

• All ACH Notifications of Change (“NOCs”) must be accessible via the Offeror’s online banking
platform/system by 6:00 a.m. local time the following business day after the NOC is received by
the bank. Access to the online banking platform/system are to give online users the ability to
search, view, print, and download/save all NOCs in Microsoft Excel and Adobe .pdf formats.

Details are to include the following:
• ACH settlement date
• Transaction description
• ACH change reason description
• ACH change reason description
• ACH changed data
• Original company tracer number
• Payee ID or Vendor ID
• Payee Name
• Payees bank account number
• Payees bank tracer number
• Payees Bank Name
• Company entry description
• Original deposit bank
• Original deposit account number
• Payment Number
• Individual Name/ID Number

• All ACH Fails/Returns must be accessible via the Offeror’s online banking platform/system by
6:00 a.m. local time the subsequent business day after the fail notification is received by the bank.
Access to the online banking platform/system are to give online users the ability to search, view,
print and download/save all ACH Fails in Microsoft Excel and Adobe .pdf formats. Online Users
must have the ability to search for ACH Fail items by selecting an account number and return date.
The following ACH Fails/Return details must be accessible via the online banking platform/system.
Details are to include the following:
• ACH settlement date
• Transaction description
• ACH change reason description
• ACH changed data
• Original company tracer number
• Payee ID or Vendor ID
• Payee Name

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• Payees bank account number
• Payees bank tracer number
• Payees Bank Name
• Company entry description
• Original deposit bank
• Original deposit account number
• Payment Number
• Individual Name/Id Number

Each State Agency's business operations and banking requirements may evolve over time. Therefore, the
Offeror is required to conduct quarterly meetings with each State Agency to discuss their customer service
challenges, business operation challenges, daily banking requirements, or potential banking enhancements.
During these meetings, each State Agency will outline the agenda or topics for discussion with the Offeror.
It is imperative that the Offeror does not view these quarterly meetings as Sales Initiative Meetings or
opportunities to promote additional products to the Agencies. The STO will actively participate and join
any meetings with each State Agency alongside the Offeror.

Income Tax Refund Disbursement Services Questions

1) What do you consider currently the most competitive features of your income tax refund disbursement
services, and specifically, your controlled disbursement product? Describe any specific experience
you have processing income tax refund disbursements.

2) How do you measure quality in income tax refund disbursement services? What quality standards do
you measure, and how has your performance been relative to the standard for the past year?

3) How do you provide customer service for income tax refund disbursement services? What service
standards are in place, and how do you perform against them?

4) What controls are available with your income tax refund disbursement services that might help
detect fraud?

5) What disbursement notification methods are available? How is the daily paid data to be transmitted
to the Office and the earliest and latest time of the transmission?

6) What kind of controlled disbursement image applications do you offer today?

7) What is your bank’s contingency plan for providing disbursement services in the event of an outage
or disaster? When was your disaster recovery plan last tested?

2.3.4 Brief Description of the Central Bureau Payroll Disbursement Account
This account is associated with the disbursement of salary payments for State employees.

a.Regular Bi-Weekly
b.Contractual – Bi-weekly
c.State Regular – Monthly
d.University – Bi-weekly
Number of separate payroll entities

General, Tax Refund, and Payroll Disbursement and Custody Services
Solicitation #: RFP #DISB -06232025 RFP Document
RFP for State Treasurer’s Office Page 9 of 106

Average monthly volume of CPB payroll
checks 12,560
Average monthly volume of CPB payroll
direct deposits 207,132
Percentage of employees on direct deposit 95%
Average monthly volume of direct
deposit failures and stop payments 125

Section 2- 402 of the State Personnel and Pensions Article of the Annotated Code of Maryland provides
that the Central Payroll Bureau is responsible for the issuance of all salary payments to State employees.

Central Payroll Bureau (“CPB”) issues salary checks and deposit advices bi -weekly for three separate
payroll entities in four main cycles. These are (a) regular - bi-weekly, (b) contractual - bi-weekly, (c)
regular – monthly, and (d) university - bi-weekly. Regular – monthly is paid the last business day of the
month. The regular and contractual pays are on alternating Wednesdays and the university is every other
Friday. Employees enrolled in the direct deposit program receive an electronic Earnings Statement (pay
stub) which shows hours worked, earnings, taxes, and deductions, as do employees who receive pay
checks.

In addition to the issuance of checks and deposit advices, CPB compiles the payroll journals, maintains
records of salary earnings and deductions for each employee of the State, and issues summary charges by
program and fund for each payroll to the Statewide Accounting and Reporting System (R*STARS)
together with a disbursement warrant.

CPB’s direct deposit system permits an employee to have a direct deposit of their net pay to a checking or
savings account at any financial institution, not just at the provider bank. Under State Treasurer regulations,
all new State employees paid through the Central Payroll Bureau are required to participate in Direct
Deposit unless the employee requested and exemption from receiving net pay by Direct Deposit. As of
January of 2024, 95% of all State employees participate in Direct Deposit.

The Treasurer’s Office Main Disbursement account funds the CPB account as needed for check clearings
and ACH transfers, investigates errors, issues stop payments, authorizes re- issuance, and balances the
account.

The STO funds the CPB account as needed for check clearances and ACH transfers, investigates errors,
issues stop payments, authorizes re- issuances and balances the account.

CPB Payroll Disbursement Requirements

This section of the procurement deals with the services associated with the disbursement of salary payments
for State employees and separately, for the Central Payroll Bureau (“CPB”) direct deposit disbursements.

General, Tax Refund, and Payroll Disbursement and Custody Services
Solicitation #: RFP #DISB -06232025 RFP Document
RFP for State Treasurer’s Office Page 10 of 106
Please indicate your compliance with the following requirements in your proposal. Indicate compliance
with a “YES” if you do meet the requirement or “NO” if you do not meet the requirement . You may
also supply brief supporting statements.

CPB Payroll services must include the following:

a) Check Issuance processing.
b) Check Status Look- Up/Confirmation
c) Return item processing.
d) Incoming and outgoing ACH transfers
e) Automated stops check payment processing.
f) Automated ACH Recall/Cancel processing.
g) Daily paid transmissions
i. Account maintenance.
ii. ARP Reporting
iii. ADHOC Reporting
h) Direct deposit processing
i) Copies or images of paid items
j) Payee Positive Pay
k) Account Enhanced Fraud Controls
l) Prenote process
m) Offeror Treasury Online Portal & Website Training/Demo

• The Offeror must complete bank reconciliations within ten (10) days of the end of a period,
typically occurring twice a month. These reconciliations are expected to be comprehensive ARP
reconciliations. Completed reconciliations should encompass all mainte nance reports utilized
during the reconciliation period, including a list of corrected check serial numbers, and rejected checks.

• Individual direct deposit transactions will be supplied to the bank prior to the issuance. The Offeror
will be expected to edit the transmission of items related to the Offeror (“on us” items) and process
the remaining transactions to the Federal Reserve ACH System in time to insure credit to the
employee by 8:30 a.m. local time on the designated pay date. The Offeror must agree to either
accept and credit or reject transactions. No unauthorized editing or interception or redirecting of
transactions will be allowed. Each transaction processed to another financial institution will be
processed in accordance with ACH rules and the State will expect the Offeror to take the lead in
resolving problems with other financial institutions when these rules are not adhered to.

• Any failed direct deposit transactions, either deposits or pre -notifications, will be communicated
directly to the Office and CPB within 48 hours of failure or within 24 hours of failure notice to
the Offeror. Funds must be returned immediately upon notice of failure. Notice must be by
electronic verification within 24 hours. This notice must contain the agency number, employee
number and name as provided on the file. The Offeror will be expected to work with ACH
transaction recipients and the clearing hous e to encourage compliance with established rules when
applicable.

• Each Offeror must agree to assist the State in the marketing of direct deposit of employee payroll
as an alternative to check disbursements. This assistance at a minimum must consist of the
organization of, and the dissemination of literature and instructions to the personnel offices of each
State agency. Offerors can anticipate the assistance of State personnel and key elected

General, Tax Refund, and Payroll Disbursement and Custody Services
Solicitation #: RFP #DISB -06232025 RFP Document
RFP for State Treasurer’s Office Page 11 of 106
officials in the performance of these functions. All marketing materials (i.e.: brochures, flyers,
etc.) are subject to State review and approval prior to use.

• The Offeror must provide an electronic or automated mechanism/process to recover, on occasion,
erroneous payroll payments that were directly deposited into an employee’s personal bank
account.

• The Offeror must provide an automated reconciliation product, more commonly referred to as a full "ARP" reconciliation.

• The CPB account reconciliation must be available bi-weekly within ten (10) days of receipt of the
closing transactions or the close of the period whichever is later. The reconciliation including two
(2) electronic copies of the paid listing must be delivered to the Office.

• Each business day the Offeror must provide/furnish CPB with account data transmission in the format agreeable to CPB that identifies every item paid or credited to the account.

• On a monthly basis the Offeror must provide CPB an electronic data transmission that identifies all the paid items and stopped items since the previous ARP reconciliation statement.

• The Offeror shall retain all paid items or images of the paid items (both back and front) for a paid
period of not less than seven years.

• All ACH failures/returns must be accessible through the Offeror’s online banking platform/system
by 6:00 a.m. local time on the subsequent business day after receiving the failure notification from
the receiving bank. The Offeror is required to generate a distinct 'Custom Report' exclusively for
ACH failures/returns for each Agency separately. This segregated 'Custom Report' for each
agency individually should be readily available on Offeror’s online banking platform/system every
business day.

Each State Agency's business operations and banking requirements may evolve over time. Therefore, the Offeror is required to conduct quarterly meetings with each State Agency to discuss their customer service
challenges, business operation challenges, daily banking requirements, or potential banking enhancements.
During these meetings, each State Agency will outline the agenda or topics for discussion with the Offeror.
It is imperative that the Offeror does not view these quarterly meetings as Sales Initiative Meetings or
opportunities to promote additional products to the Agencies. The STO will actively participate and join
any meetings with each State Agency a longside the Offeror.

CPB Payroll Disbursement Questions

1) What do you consider currently the most competitive features of your payroll services, and specifically
your controlled disbursement product?

2) How do you measure quality in payroll services? What quality standards do you measure, and how
has your performance been relative to the standard for the past year?

3) How do you provide customer service for payroll services? What service standards are in place, and
how do you perform against them?

General, Tax Refund, and Payroll Disbursement and Custody Services
Solicitation #: RFP #DISB -06232025 RFP Document
RFP for State Treasurer’s Office Page 12 of 106
4) Describe the Offeror's failure processing system for Direct Deposits. Does the system guarantee the
return of funds to the account at the same time as notification?

5) Please describe your capabilities to recover erroneous payroll payments that were direct deposited into
an employee’s personal bank account.

2.3.5 Brief Description of the MTA Payroll Account
This account is associated with the disbursement of salary payments for State Transit Union employees.
MTA maintains a payroll account to pay Transit Union employees and pensioners weekly and monthly as
well as vendors and is funded by the Treasurer’s Office Main Disbursement account as needed for check
clearings and ACH transfers.

This account is also used to pay:
1. SECU/Destinations - for when employees have an account with them, where we send it to this
bank instead of it being deposited directly into their account, then the bank disburses as outlined
by the employee/pensioner
2. Child support/other garnishments
3. Union dues
4. Federal tax withholdings
5. Nationwide for 401k or 457 accounts
6. SF&C - additional insurance for police officers
7. Other similar vendors

Average monthly volume of MTA payroll
checks issued 308
Average monthly volume of MTA payroll
direct deposits 12,841
Percentage of MTA employees on direct
deposit 99.5% of weekly employees and 95% of
pensioners
Average monthly volume of MTA payroll
checks paid 314
Average monthly volume of MTA payroll
electronic payments/direct deposits 100

MTA Payroll Disbursement Requirements

This section of the procurement deals with the services associated with the disbursement of salary payments
for State employees and separately, for the Maryland Transit Administration (“MTA”) salary payments.

General, Tax Refund, and Payroll Disbursement and Custody Services
Solicitation #: RFP #DISB -06232025 RFP Document
RFP for State Treasurer’s Office Page 13 of 106
Please indicate your compliance with the following requirements in your proposal. Indicate compliance
with a “YES” if you do meet the requirement or “NO” if you do not meet the requirement . You may
also supply brief supporting statements.

MTA Payroll services must include the following:
a) Check processing
b) Return item processing
c) Incoming and outgoing wire transfers
d) Incoming and outgoing ACH transfers
e) Automated/Electronic stop payment processing
f) Daily paid transmissions
g) Account maintenance.
h) Direct deposit processing
i) Copies or images of paid items
j) Payee Positive Pay
k) Prenote Process

• The Offeror must complete bank reconciliations within ten (10) days of the end of a period, typically
occurring twice a month. These reconciliations are expected to be comprehensive ARP
reconciliations. Completed reconciliations should encompass all maintenance reports utilized during
the reconciliation period, including a list of corrected check serial numbers and rejected checks.

• Individual direct deposit transactions will be supplied to the bank prior to the issuance. The Offeror
will be expected to edit the transmission of items related to the Offeror (“on us” items) and process
the remaining transactions to the Federal Reserve ACH System in time to insure credit to the
employee by 9:00 a.m. local time on the designated pay date. The Offeror must agree to either accept
and credit or reject transactions. No unauthorized editing or interception or redirecting of
transactions will be allowed. Each transaction processed to another financial institution will be
processed in accordance with ACH rules and the State will expect the Offeror to take the lead in
resolving problems with other financial institutions when these rules are not adhered to.

• Any failed direct deposit transactions, either deposits or pre -notifications, will be communicated
directly to the Office and MTA within 48 hours of failure or within 24 hours of failure notice to the
Offeror. Funds must be returned immediately upon notice of failure. Notice must be by electronic
verification within 24 hours. This notice must contain the agency number, employee number and
name as provided on the file. The Offeror will be expected to work with ACH transaction recipients
and the clearing hous e to encourage compliance with established rules when applicable.

• Each Offeror must agree to assist the State in the marketing of direct deposit of employee payroll as
an alternative to check disbursements. This assistance at a minimum must consist of the organization
of, and the dissemination of literature and instructions to the personnel offices of each State agency.
Offerors can anticipate the assistance of State personnel and key elected officials in the performance

General, Tax Refund, and Payroll Disbursement and Custody Services
Solicitation #: RFP #DISB -06232025 RFP Document
RFP for State Treasurer’s Office Page 14 of 106
of these functions. All marketing materials (i.e.: brochures, flyers, etc.) are subject to State review
and approval prior to use.

• The Offeror must provide an electronic or automated mechanism/process to recover erroneous
payroll payments that were directly deposited into an employee’s personal bank account within 30
days.

• The Offeror must provide an automated reconciliation product, more commonly referred to as a full
"ARP" reconciliation.

• As a part of this reconciliation product the Offeror must provide daily a paid items tape noting the items paid and stopped the previous day. The MTA requires a full monthly reconciliation including
two monthly electronic listings.

• Each business day the Offeror must provide the Office with a data transmission in the format
agreeable to the MTA that identifies every item paid or credited to either account separated by
account.

• On a monthly basis the Offeror must provide MTA an electronic data transmission that identifies all
the paid items and stopped items since the previous transmission.

• The Offeror shall retain all paid items or images of the paid items (both back and front) for a paid period of not less than seven years.

• All ACH failures/returns must be accessible through the Offeror’s online banking platform/system
by 6:00 a.m. local time on the subsequent business day after receiving the failure notification from
the receiving bank. The Offeror is required to generate a distinct 'Custom Report' exclusively for ACH failures/returns for each Agency separately. This segregated 'Custom Report' for each agency
individually should be readily available on Offeror’s online banking platform/system every business
day.

Each State Agency's business operations and banking requirements may evolve over time. Therefore, the Offeror is required to conduct quarterly meetings with each State Agency to discuss their customer service
challenges, business operation challenges, daily banking requirements, or potential banking enhancements.
During these meetings, each State Agency will outline the agenda or topics for discussion with the Offeror.
It is imperative that the Offeror does not view these quarterly meetings as Sales Initiat ive Meetings or
opportunities to promote additional products to the Agencies. The STO will actively participate and join any
meetings with each State Agency alongside the Offeror.

MTA Disbursement Questions

1) What controls are available with your payroll services that might help detect fraud?