TITLE 35: ENVIRONMENTAL PROTECTION SUBTITLE C: WATER POLLUTION
SUBTITLE C: WATER POLLUTION
CHAPTER II: ENVIRONMENTAL PROTECTION AGENCY
PART 365 PROCEDURES FOR ISSUING LOANS FROM THE WATER POLLUTION CONTROL LOAN PROGRAM SUBPART A: INTRODUCTION
SECTION 365.620 CONSTRUCTION CONTRACTS
Section 365.620 Construction Contracts
The following procedures shall apply to construction contracts (subagreements) awarded by loan recipients for the construction phase only. They shall not apply to personal and professional service contracts.
a) Each construction contract shall include the following provisions:
1) Audit; Access to Records
A) The contractor shall maintain books, records, documents and other evidence directly pertinent to performance on loan work in accordance with generally accepted accounting principles. The contractor shall also maintain the financial information and data used by the contractor in the preparation or support of any cost submissions required under Section 365.420(b)(2) and a copy of the cost summary submitted to the owner. The Illinois Auditor General, the owner, the Agency, or any of their authorized representatives shall have access to the books, records, papers, documents, and other evidence for purposes of inspection, audit, examination, excerpts, transcriptions, and copying. The contractor shall provide facilities for access and inspection.
B) For a formally advertised, competitively awarded, fixed price contract, the contractor shall include access to records as required by subsection (a)(1)(A) for all negotiated change orders and contract amendments in excess of $150,000 that affect the contract price. In the case of all other prime contracts, the contractor shall agree to include access to records required by subsection (a)(1)(A) in all contracts and all tier subcontracts or change orders in excess of $150,000 that are directly related to project performance.
C) Audits shall be in accordance with auditing standards generally accepted in the United States.
D) The contractor shall agree to the disclosure of all information and reports resulting from access to records required by subsection (a)(1)(A). When the audit concerns the contractor, the auditing agency shall afford the contractor an opportunity for an audit exit conference and an opportunity to comment on the pertinent portions of the draft audit report. The final audit report shall include the written comments, if any, of the audited parties.
E) The records required by subsection (a)(1)(A) shall be maintained and made available during performance of the work under the loan agreement and for 3 years after the date of final loan audit. In addition, records that relate to any dispute or litigation or the settlement of claims arising out of any performance, costs or items to which an audit exception has been taken shall be maintained and made available for 3 years after resolution of the dispute, appeal, litigation, claim, or exception.
F) The right of access will generally be exercised with respect to financial records under:
i) negotiated prime contracts;
ii) negotiated change orders or contract amendments in excess of $150,000 affecting the price of any formally advertised, competitively awarded, fixed price contract; and
iii) subcontracts or purchase orders under any contract other than a formally advertised, competitively awarded, fixed price contract.
G) The right of access will generally not be exercised with respect to a prime contract, subcontract, or purchase order awarded after effective price competition. In any event, the right of access shall be exercised under any type of contract or subcontract:
i) with respect to records pertaining directly to contract performance, excluding any financial records of the contractor; and
ii) if there is any indication that fraud, gross abuse, or corrupt practices may be involved in the award or performance of the contract or subcontract.
2) Covenant Against Contingent Fees
The contractor shall warrant that no person or selling agency has been employed or retained to solicit or secure the contract upon an agreement or understanding for a commission, percentage, brokerage, or contingent fee. For breach or violation of this warranty, the owner shall have the right to annul the contract without liability or in its discretion to deduct from the contract price or consideration, or otherwise recover, the full amount of the commission, percentage, brokerage, or contingent fee.
3) Wage Provisions
The contractor shall pay prevailing wages in accordance with the Davis-Bacon Act (40 USC 3141 through 3148), as defined by the US Department of Labor.
4) Disadvantaged Business Enterprise Requirements
The contractor shall provide evidence that the contractor has taken affirmative steps in accordance with 40 CFR 33 to assure that disadvantaged business enterprises are used when possible as sources of supplies, equipment, construction, and services, consistent with the provisions of the Agency's Operating Agreement with USEPA.
5) Debarment and Suspension Provisions
The contract shall require the successful bidders to submit a Certification Regarding Debarment, Suspension and Other Responsibility Matters (EPA Form 5700-49) showing compliance with federal Executive Order 12549.
6) Nonsegregated Facilities Provisions
The successful bidder shall be required to submit a certification of nonsegregated facilities on forms provided by the agency.
7) American Iron and Steel
The successful bidder shall be required to use American Iron and Steel, if required by USEPA for that fiscal year.
8) A clause that provides:
"No contractor or subcontractor shall discriminate on the basis of race, color, national origin or sex in the performance of this contract. The contractor or subcontractor shall carry out applicable requirements of 40 CFR 33 in the award and administration of contracts awarded under the WPCLP. Failure by the contractor or subcontractor to carry out these requirements is a material breach of this contract which may result in the termination of this contract or other legally available remedies."
b) Subcontracts Under Construction Contracts
The award or execution of all subcontracts by a prime contractor and the procurement and negotiation procedures used by the prime contractor shall comply with:
1) all applicable provisions of federal, State, and local law;
2) all provisions of this Part regarding fraud and other unlawful or corrupt practices;
3) all provisions of this Part with respect to access to facilities, records and audit of records; and
4) all provisions of subsection (a)(5) that require a Certification Regarding Debarment, Suspension, and Other Responsibility Matters (EPA Form 5700-49) showing compliance with any controlling federal Executive Orders.
c) Contractor Bankruptcy
In the event of a contractor bankruptcy, the loan recipient shall notify the Agency and shall keep the Agency advised of any negotiations with the bonding company, including any proposed settlement. The Agency may participate in those negotiations and will advise the loan recipient of the impact of any proposed settlement to the loan agreement. The loan recipient shall be responsible for assuring that every appropriate procedure and incidental legal requirement is observed in advertising for bids and re-awarding a construction contract.
d) Every contract entered into by the loan recipient for construction work, and every subagreement, shall provide Agency representatives with access to the work. The contractor or subcontractor shall provide facilities for the access and inspection.