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CITY OF SAN BERNARDINO - REQUEST FOR COUNCIL ACTION
From: Valerie C. Ross, Director
Subject: Resolution approving a rcimbuhcmcnt
agreement with Hillwood rclated to thc
North San Bernardino Industrial Park
Project.
Dept: Development Services
Date: September 9, 2008
MCC Date: October 6, 2008
Synopsis of Previous Council Action:
April 7, 2008. The Mayor and Common Council adopted Resolution No. 2008-115 accepting a
grant from the Federal EDA.
May 5, 2008. The Mayor and Common Council authorized the Finance Director to create a new
capital improvement project for the North San Bernardino Industrial ParkiFedEx
Project.
Recommended Motion:
Adopt Resolution.
~{/. 7(~
Valerie C. Ross
Contact Person: Valerie Ross
Phone: 5357
Supporting data attached: Staff Report
Ward: tl
FI.'l\'D1NG REQUIREMENTS:
Amount: N/ A
Source:
Acct. Description:
Council Notes:
Finance:
~50 2&08-379
Agenda Item No.~
, (J ,lI.08
CITY OF SAN BERNARDINO REQUEST FOR COUNCIL ACTION
STAFF REPORT
Subject:
Resolution approving a Reimbursement Agreement with Hillwood related to the North San
Bernardino Industrial Park Project.
Background:
At their meeting of April I, 2008, the Grants Ad Hoc Committee recommended that the Mayor
and Common Council accept the $ I ,500,000 Federal Economic Development Administration
grant. The Mayor and Common Council accepted the grant at their meeting of April 7, 2008. The
Federal EDA Grant is for infrastructure improvements along the frontage of the FedEx Project
site including curb, gutter, sidewalk, and pavement rehabilitation. The project sitc is located on
the westerly side of Cajon Boulevard at the northwesterly portion of the City and the cntire
project is estimated to cost $3,750,000. At their May 5, 2008 meeting, the Mayor and Common
Council authorized the Finance Director to create a new capital improvement project (SS08-35).
This request is for the City to enter into a Reimbursement Agreement with Hillwood for the
reimbursement to the City of the costs of the above referenced street improvements. The actual
costs to be reimbursed by Hillwood will be net of the available grant proceeds to be received by
the City through the Federal EDA Grant. Hillwood has prepared the plans and speeitlcations tin
the inti'astructure improvements as summarized above at their cost. Devclopment Services will
bid the project, seck an award from the Council of the public works contract for construction,
manage the project, and administer the Federal EDA Grant including all compliance issues and
obtaining of the grant reimbursements. Hillwood will reimburse the City for the direct and
indirect costs associated with these tasks and will guaranty the financial performance of
Hillwood through a letter of credit from Wells Fargo Bank for all costs that are not reimbursed
througb the Federal EDA Grant.
Financial Impact:
There is no tlnancial impact to tbe City.
Recommendation:
Adopt Resolution
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RESOLUTION NO.
RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF SA:\'
BERNARDINO AUTHORIZING THE EXECUTION OF A REIMBURSDIENT
AGREEMENT WITH HlLLWOOD FOR THE FEDERAL ECONOMIC
DEVELOPMENT ADMINISTRATION GRANT - CAJON BOULEVARD PUBLIC
INFRASTRUCTURE IMPROVEMENTS FOR THE NORTH SA'\' BERNARDINO
INDUSTRIAL PARK PROJECT.
BE IT RESOLVED BY THE MAYOR AND COMMON COU\CIL OF THE
CITY OF SAN BERNARDINO AS FOLLOWS:
SECTION 1: The Mayor and Common Council of the City of San Bemardino hereby
authorize the City Manager to execute the Reimbursement Agreement with Ilill\\ood rclated to
the Federal Economic Development Administration Grant public infrastructure improvements
on Cajon Boulevard related to Hillwood's North San Bemardino Industrial Park Project, a copy
of attached Reimbursement Agreement is attached and incorporated herein as Exhibit "I."
SECTION 2: Said Agreement shall be null and void if either party fails to
execute the Agreement within sixty (60) days after the date of adoption of this
Resolution.
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10-6 -08
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RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF S1\;\
BERNARDINO AUTHORIZING THE EXECUTION OF A REIMBURSEMENT
AGREEMENT WITH HILLWOOD FOR THE FEDERAL ECONOMIC
DEVELOPMENT ADMINISTR~ TION GRANT - CAJON BOULEVARD PUBLIC
INFRA3TRUCTURE IMPROVEMENTS FOR THE NORTH SA1\' BER'\ARDINO
11\'DUSTRIAL PARK PROJECT.
I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the '.Iayor
7 and Common Council of the City of San Bernardino at a
meeting thereof. held on the
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,2008, by the following vote, to wit:
day of
Council Members:
AYES
:\AYS
ABSTArJ\
ABSENT
ESTRADA
BAXTER
BRINKER
DERRY
KELLEY
JOHNSON
MC CAMMACK
City Clerk
day of
,2008.
The foregoing resolution is hereby approved this
Patrick 1. Morris, Mayor
City of San Bernardino
Approved as to form:
JAMES F. PENMAN,
City Attorney
By:
2
L'l.I1IlH 1 J
REIMBURSEMENT AGREEMENT WITH HILLWOOD FOR THE FEDERAL
ECONOMIC DEVELOPMENT ADMINISTRATION GRANT - CAJON BOULEVARD
PUBLIC INFRASTRUCTURE IMPROVEMENTS PROJECT FOR HILL WOOD'S NORTH
SAN BERNARDINO INDUSTRIAL PARK PROJECT
This Reimbursement Agreement for the Federal Economic Development Administration
Grant _ Cajon Boulevard Improvement Project for Hillwood's North San Bernardino Industrial Park
(this "Agreement"). is entered into and shall be effective as of 2008, by and
between North San Bernardino Industrial Park, L.P. ("Hillwood"), an affiliate of Hillwood
Development Company, LLC, and the City of San Bernardino, a charter city established and existing
pursuant to the Constitution and laws of the State of California and the City Charter (the "City").
Hillwood and the City are each referred to herein as a "Party" and are collectively referred to as the
"Parties."
RECITALS
A. The City on behalf of Hillwood has filed an application with the United States
Department of Commerce, Economic Development Administration ("Federal EDN'), for an
economic development infrastructure grant (the "Grant") in the principal amount not to exceed
$1,500,000 based upon an estim'ated total project cost of $3,750,000 for the construction and
installation on the west half of Cajon Boulevard within the City of San Bernardino adjacent to the
development known as the North San Bernardino Industrial Park (the "Development Proiect"), of
certain roadway widening improvements consisting of approximately 5,452 linear feet in curb and
gutter, and side walk, landscaping. street lights, and traffic signals (such public improvements are
herein referred to as the "Grant Proiect"). It is expected that Hillwood will advance the costs of the
Grant Project for which forty percent (40%) ofthe eligible costs will be subject to reimbursement by
the Federal EDA in accordance with the documentation required for the Grant Project. The Grant
Project application as approved by the Federal EDA is attached hereto as Exhibit "A" (identified
herein as the "Grant Application "j and incorporated herein by this reference; and
B. The City has caused to be prepared the plans, specifications, public bid documents
and public works contracts for the constmction of the Grant Project, Hillwood has agreed pursuant
to the terms of this Agreement to advance all costs as required by the City in preparation for the
construction of the Grant Project. Hillwood has agreed, pursuant to the terms of this Agreement, to
remit to the City all costs in accordance with the invoices for the work performed on the Grant
Project by the Public Works Contractor approved by the City. Upon receipt of payments from
Hillwood,the City shall submit the appropriate documentation to the Federal EDA for reimbursement
of the Federal Share of Cost described in the EDA grant award for the Grant Project. Upon receipt
of the Fedeml Share of Cost from the EDA, the City shall pay over such sum to Hillwood as full and
complete reimbursement for their earlier payment of the costs to the public works contractor; and
C. The Parties seek to memorialize their agreement and understanding on the terms and
conditions under which Hillwood will participate in the preparation of all public works plans,
specifications, and public bid documents for the Grant Project; on which the City will undertake the
F:\\\;ILSON\Agreements\~lillwood Reimbursement Agreement 9-29.08b.doc
EXHIBIT 1
public bidding process and the award ofthe construction contract for the Grant Project to the lowest
responsive and responsible bidder; and, the terms pursuant to which Hillwood will pay the invoices
submitted by the public works contractor for work in furtherance of the Grant Project.
D. The City previously issued permits for the development and construction of the
Development Project in accordance with certain Conditions of Approval imposed by the City in DP2
No. 06-23 (the "Conditions of Approval"). Certain ofthe Conditions of Approval relate to the Grant
Project and certain ancillary matters. The Development Project consists of three sites on which
warehouse/distribution buildings and related improvements have been and are in the process of being
constructed. One of those sites (generally shown on the attached Exhibit "B") is the parcel on which
the FedEx building has been completed and now is occupied and in operation and for which the City
has issued a final certificate of occupancy. A second site is referred to on the attached Exhibit B as
"Building One," for which a final certificate of occupancy has also been issued. Improvements on
the remaining site (referred to as "Building Two," as identified on Exhibit "B") are under
construction. Because of the assurances described in this Agreement that the Grant Project and
certain other Conditions of Approval items will be completed, the City is willing to issue the final
certificates of occupancy for Building Two upon satisfaction of all City requirements for a final
certificate of occupancy, notwithstanding that the Grant Project and certain other related Conditions
of Approval items have not been completed, as provided in this Agreement.
A\!reements
In furtherance of the Recitals set forth above, the Parties hereby agree as follows:
1. Approval of Public Works Construction Contract.
a. Award of Public Works Construction Contract bv the Citv. The City shall
award the contract (the "Public Works Construction Contract") to the lowest responsive and
responsible bidder (the "Public Works Contractor") and expeditiously commence the construction of
the work described in the Grant Project. The City shall control all aspects of the Public Works
Construction Contract and Hillwood shall have no authority to direct the Public Works Contractor.
Hillwood may provide suggestions to the City staff as to the scope of the Public Works Construction
Contract and as to the manner in which it shall be undertaken and prepared. The City shall not be
required to proceed with any phase or to issue a Notice to Proceed for the Public Works Construction
Contract and commencement of work on the Grant Project until such time as the executed Letter of
Credit (hereinafter defined) has been delivered to the City.
b. Coordination of the Public Works Construction Contract. The City shall
direct the Public Works Contractor in full conformity with the terms of Exhibit "A" in accordance
with public works construction practices. Hillwood staff will be permitted to participate in meetings
conducted by the City staff with the Public Works Contractor. The City shall designate a
management person in the Development Services Department to be the lead City staff person
regarding the preparation of the Public Works Construction Contract and all other public bidding
documentation and the coordination with Hillwood and other participants.
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EXHIBIT I
c. Compliance with Applicable Laws. The City warrants and represents that: (i)
prior to the date of this Agreement it has complied with the provisions of the California
Environmental Quality Act of 1970, as amended ("CEOA"), and will comply with all other
applicable laws, including all requirements of the Federal EDA, for the publication of notices,
undertaking of the competitive bidding process and the approval and award of the Public Works
Construction Contract, and (ii) it will inspect and approve all work performed pursuant to the Public
Works Construction Contract in accordance with all applicable laws and consistent with industry
standards and requirements of the Federal EDA.
d. Final Bids for the Grant Project. The City shall forward to Hillwood and the
Federal EDA a copy of the bids as received for the Grant Project and the proposed Public Works
Construction Contract prior to the approval and award by the City for purposes of notifying
Hillwood and obtaining the preliminary consent of the Federal EDA. References in this Agreement
to approval by the Federal EDA are applicable only to the extent such approval is required by
applicable law or regulation.
e. Pavment to the Citv by Hillwood.
(i) Hillwood shall reimburse the City for all of the direct and indirect costs
(including, but not limited to, third party consultants and allocated internal City costs) incurred in
connection with filing, processing and administration of the Grant Application, and the Grant and
fundings under the Grant (the "Grant Costs"). The City shall provide to Hillwood an invoice for the
Grant Costs (with a general description thereof).
(ii) Hillwood shall reimburse the City, and the City shall provide to Hillwood
invoices for the costs incurred by the City based upon invoices received from the Public Works
Contractor for applicable phases in furtherance of the construction and installation of the Grant
Project.
(iii) The City shall prepare and send an invoice to Hillwood for payment to the
City of the amounts ofthe then current outstanding invoices from the Public Works Contractor to the
City and/or for incurred Grant Costs. Hillwood shall pay City by electronic transfer the amounts set
forth therein within fifteen (15) calendar days after receipt of such invoice.
(iv) Time is of the essence with respect to the remittance by Hillwood to City of
the Grant Costs and of the payments to be made to the City by Hillwood for payment over to the
Public Works Contractor. The Failure of Hillwood to remit the required amounts as set forth herein
shall be grounds for the City to terminate this Agreement. Any such termination shall be effective
immediately upon delivery of the notice of termination to Hillwood at the address set forth below.
(v) Separate and apart from termination, the failure of Hilllwood to remit the
required sums at the time and in the amounts set forth herein shall be grounds for the City to declare
Hi\llwood in default. Upon such declaration of default, the City shall make demand and take
possession of up to and including the full amount of the sums held under the Irrevocable Letter of
Credit provided to City pursuant to Section I(i) of this Agreement (the "Proceeds"). The Proceeds
shall thereafter be held by City, interest free, as a deposit for funding of costs which are due and
,
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F:\ WILSON\Agreements\Hillwood Reimbursement Agreement 9~29.08b_doc
EXHIBIT ]
payable and as may thereafter become due and payable from Hillwood under this Agreement. Prior
to submission of the demand to the holder of the Irrevocable Lener of Credit, City shall provide
Hillwood with written notice of intent to proceed under this subsection. Hillwood shall thereafter
have five (5) calendar days within which to submit the required payments to the City. Upon the
conclusion of the Grant Project, City shall return to Hillwood any portion of the Proceeds not used to
pay Grant Project costs and Grant Costs.
(vi) Hillwood, within ten (10) days after receiving written demand therefor from
the City, shall pay to the City any amount by which the unpaid Grant Project costs and Grant Costs
exceed the Proceeds, including costs of any Expanded Services Change Order. The City,
notwithstanding any such failure to remit by Hillwood, may continue the Grant Project, up to and
including completion, and at any time commence action against Hillwood for recovery of the under
payment.
a) The City shall provide Hillwood with a copy of any written request made by the City to the
Public Works Contractor for additional time and/or materials and/or services within five (5)
business days after submittal of the request to the Public Works Contractor or his/herrepresentative.
Any such request shall be for a change order that is within the scope of the Grant Project. Any such
change order will be a written change order (each being referred to as a "Change Order") and on a
time and materials basis as provided in the Public Works Construction Contract. A Change Order
hereunder shall be requested only to the extent as required for the completion of the Grant Project
and subject to the prior approval of the Federal EDA. b) If Change Order requests are, I) required
after the date of the award of the Public Works Construction Contract and 2) increase the total cost
of the Grant Project due to an expansion of the scope of services over that described in the the
Public Works Construction Contract (each an "Expanded Services Change Order"), the City shall
authorize such Expanded Services Change Order only with the prior written approval of Hillwood
and the Federal EDA. Upon its approval of the Expanded Services Change Order, Hillwood shall
be liablefor payment of the cost of such Expanded Services Change Order, to the City, in the same
amount as for other Grant Project Costs. c) In the event that Hillwood (i) fails to approve a
Change Order request that is within the scope of the Grant Project after approval by the Federal EDA
and/or (ii) to deposit the required dollar amount value of such Change Order with the City within 30
calendar days following approval by the Federal EDA, and iii) the City makes the finding that the
Change Order is necessary for the furtherance of the Grant project, the City shall have the right to
proceed with such Change Order and to require Hillwood to reimburse the City in the amounts of
such Federal EDA approved Change Order as are consistent with Hillwood's share of Grant Project
Costs under this Agreement.
(vii) The City shall present Hillwood with an invoice for the Grant Costs
and Grant Project Costs on a quarterly basis or on such other periodic basis as shall have been
previously agreed to with the Public Works Contractor. Hillwood shall deposit payment for said
invoice to the account of the City by electronic transfer, as shall be designated in writing from the
City to Hillwood, within fifteen (15) calendar days after Hillwood's receipt of said invoice.
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EXHIBIT J
f. Submittal of Reimbursement Requests to Federal EDA. I) The City agrees to
timely submit to the Federal EDA all reimbursement requests as are in accordance with the Federal
EDA approval of the Grant Project ("Reimbursement Request"). Such Reimbursement Requests
shall be submitted by the City after a payment has been remitted by the City to the Public Works
Contractor for a Grant Project cost, and documentation for receipt of such payment has been
received by the City. Upon receipt from the Federal EDA of the reimbursement ("Reimbursement
Amount") , such amounts shall be held by the City and credited towards the next succeeding
payment request to be submitted to HiIlwood for payment of the periodic invoices of the Public
Works Contractor. 2) Upon payment by the City of all invoices as shall be properly submitted by
the Public Works Contractor for payment, the City shall prepare a final reconciliation of all costs of
the Grant Project together with a designation of those amounts, if any, that may be due and owing by
the City to HiIlwood. Such sums shall represent any excess funding of the Grant Project costs and
Grant Costs by Hillwood. The dollar amount of such excess funding attributable to HiIlwood shall
be remitted by the City to Hillwood within thirty (30) days after authorized representatives of the
Parties have agreed upon the final reconciliation of all such costs of the Federal EDA Grant Project.
g. Insurance. The City shall cause the Public Works Contractor, and all
subcontractors, to carry insurance in substantially the form set forth in the City's public works
contracts, and in Federal EDA Grant Project requirements. Such insurance shall be primary; shall
name Hillwood, its directors, officers, partners, employees, consultants and agents and any persons
who are successors-in-interest to Hillwood as owner of parcels in the Development Project as
additional insureds by endorsement; and shall provide that Hillwood shall be given at least fifteen
(15) calendar days' advance notice in the event of proposed cancellation. The City shall cause the
Public Works Contractor, in addition and all subcontractors, to provide such certificates of insurance
to the City before the Public Works Contractor, or any subcontractor commences any work on the
Grant Project.
h. Conditions of Approval. The issuance by the City of final certificates of
occupancy for Building Two shall be issued and not be delayed due to those items of the Conditions
of Approval set forth on the attached Exhibit "c" (the "Grant Proiect Related COA's") not being
completed. Such delivery is subject to the proviso that all other final certificate of occupancy
requirements for Building Two have been satisfied. Hillwood agrees to complete the work on the
Grant Project Related COA' s on a schedule reasonably acceptable to the City that coordinates such
work with the Grant Project work. If Hillwood fails to perform such work in accordance with this
provision, and such failure is not cured within 30 days after Hillwood receives written notice thereof
from the City (or within such longer reasonable period of time due to the nature of such failure,
provided that cure efforts are commenced within said 30-day period and are thereafter diligently
pursued), the City (a) shall have the right to perform such work, and (b) may declare a default, make
demand, and draw down on the Letter of Credit the amount necessary to fund the costs of such work
and utilize those draw proceeds for that purpose.
i. Letter of Credit. I) As security for the payments due by Hillwood under this
Agreement, HiIlwood, upon execution of this Agreement, shall deliver to City a letter of credit in the
amount of$3,750,000 in form substantially as set forth on the attached Exhibit "D" and issued by a
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EXHIBIT 1
bank reasonably acceptable to the City (the "Letter of Credit"). 2) If Hillwood, by April 20, 2009,
has not made all payments required of it under this Agreement, the City shall have the right to
declare a default, make a demand and draw down under the Letter of Credit Proceeds in the
estimated amount necessary, in the good faith judgment of the City, to pay the remaining amounts
then due and owing by Hillwood and as shall thereafter become due and owing by Hillwood under
this Agreement 3) Without notice or demand from the City, Hillwood shall determine if its
obligation to make payments under this Agreement shall continue past April 30, 2009. Unless
Hillwood. by April 20, 2009, has delivered to the City an extension or replacement of the Letter of
Credit with a revised expiration date reasonably acceptable to the City, City shall declare a default,
make demand and draw down under the Letter of Credit Proceeds in the estimated amount
necessary, in the good faith judgment of the City, to pay the remaining amounts then due and owing
by Hillwood and as shall thereafter become due and owing by Hillwood under this Agreement
2. Administration of Public Works Construction Contract.
a. General Management and Oversight of the Grant Proiect. The City agrees that
it shall be responsible for the general management and oversight of the preparation of the public
bidding documents, and for the review and approval of all plans and specifications for the Grant
Project submitted by Hillwood to the City. The City shall be responsible for the administration of
all aspects of the Grant Project during the term ofthe Grant Project. Hillwood shall have no right or
obligation to manage or oversee the activities of the Public Works Contractor in the implementation
and performance of the Public Works Construction Contract except as specifically set forth herein.
b. Indemnification. Each Party agrees and shall indemnify and hold each the
other, its directors, officers, elected officials, employees, agents, authorized volunteers, or
representatives, free and harmless from all claims, demands, actions, damages and liabilities of any
kind and nature arising from bodily injury, including death, violations of right to privacy, or property
damage, based or asserted upon any actual or alleged act or omission oftheir employees, agents, or
subcontractors, relating to or in any way connected with the performance of the terms of this
Agreement, unless the bodily injury, property damage or other claimed injury was actually caused by
the willful misconduct, sole negligence, or active negligence of the Party, its directors, officers,
elected officials, employees, agents, authorized volunteers, or representatives. As part of the
foregoing indemnity, each Party agrees to protect and defend at its expense, including attorney's
fees, each the other, its directors, officers, elected officials, employees, agents, authorized
volunteers, or representatives, from any and all administrative or other legal actions based upon such
actual or alleged acts or omissions. Each Party hereby waives any and all rights it may have to any
types of express or implied indemnity against the other, their directors, officers, elected officials,
employees, agents, authorized volunteers, or representatives, with respect to third party claims
relating to or in any way connected with the performance of the terms of this Agreement.
3. Administration of Agreement.
a. Books and Records. Each Party shall have access to and the right to examine
the other Party's pertinent books, documents, papers or other records (including, without limitation,
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EXHIBIT 1
records contained on electronic media) relating to the performance of that Party's obligations
pursuant to this Agreement. The Parties shall each retain all such books, documents, papers or other
records to facilitate such review. Access to each Party's books and records shall be during normal
business hours only. Nothing in this paragraph shall be construed to operate as a waiver of any
applicable privileges.
b. Disputes. The Parties recognize that there may be disputes regarding the
obligations of the Parties or the interpretation of this Agreement. The Parties agree that they may
attempt to resolve disputes as follows:
(1) Statement Describing Alleged Violation of Agreement. A Party or
Parties alleging a violation of this Agreement (the "Initiating Party" or "Initiating
Parties") shall provide a written statement describing all facts that it believes
constitute a violation of this Agreement to the Party or Parties alleged to have
violated the terms of this Agreement (the "Responding Party" or the "Responding
Parties").
(2) Response to Statement of Alleged Violation. The Responding Party or
Responding Parties shall have sixty (60) calendar days from the date of the written
statement to prepare a written response to the allegation of a violation of this
Agreement and serve that response on the Initiating Party or Initiating Parties or to
cure the alleged violation to the reasonable satisfaction of the Initiating Party or
Initiating Parties. The Initiating Party or Initiating Parties and the Responding Party
or Responding Parties shall then meet within thirty (30) calendar days after the date
of the response to attempt to resolve the dispute amicably.
(3) Mediation of Dispute. If the Initiating Party or Initiating Parties and
the Responding Party or Responding Parties cannot resolve the dispute within ninety
(90) calendar days after the date of the written response, they shall engage a
mediator, experienced in public works construction disputes, to attempt to resolve
the dispute. Each Party shall ensute that it is represented at the mediation by a
public official or corporate officer. These representatives of the Initiating Party or
Initiating Parties and the Responding Party or Responding Parties may consult with
staff and/or technical consultants during the mediation and such staff and/or
technical consultants may be present during the mediation. The costs of the
mediator shall be divided evenly between the Initiating Party or Initiating Parties
and the Responding Party or Responding Parties.
(4) Reservation of Rights. Nothing in this subsection 3.b shall require a
Party to comply with the dispute resolution process contained herein and each Party
retains and may exercise at any time all legal and equitable rights and remedies it
may have to enforce the terms of this Agreement; provided, that prior to
commencing litigation, a Party shall provide at least five (5) calendar days' written
notice of its intent to sue to all Parties.
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4. General Provisions.
a. Authoritv. Each signatory of this Agreement represents that they are duly
authorized to execute this Agreement on behalf of the Party for which such signatory executes this
Agreement. Each Party represents that it has the appropriate legal authority to enter into this
Agreement and to perform all obligations under this Agreement, inciuding, but not limited to, the
payment of dollar amounts to the other Party as required herein.
b. Amendment. This Agreement may be amended or modified only by a written
instrument executed by each of the Parties to this Agreement and approved by their respective
governing boards.
c. Jurisdiction and Venue. This Agreement shall be governed by and construed
in accordance with the laws of the State of California, except for its conflicts oflaw rules. Any suit,
action or proceeding brought under the scope of this Agreement shall be brought and maintained to
the extent allowed by law in the County of San Bernardino, California.
d. Headings. The paragraph headings used in this Agreement are intended for
convenience only and shall not be used in interpreting this Agreement or in determining any of the
rights or obligations of the Parties to this Agreement.
e. Construction and Interpretation. This Agreement has been arrived at through
negotiations and each Party has had a full and fair opportunity to revise the terms of this Agreement.
As a result, the normal rule of construction that any ambiguities are to be resolved against the
drafting Party shall not apply in the construction or interpretation of this Agreement.
f. Entire Agreement. This Agreement constitutes the entire agreement of the
Parties with respect to the subject matter of this Agreement and supersedes any and all prior oral or
written agreement, understanding or representation relating to the subject matter of this Agreement.
g. Partial Invaliditv. If, after the date of execution of this Agreement, any
provision of this Agreement is held to be illegal, invalid or unenforceable under present or future
laws effective during the term of this Agreement, such provision shall be fully severable. However,
in lieu thereof, there shall be added a provision as similar in terms to such illegal, invalid or
unenforceable provision as may be possible and as may be legal, valid and enforceable.
h. Successors and Assigns. This Agreement shall be binding on and inure to the
benefit of the successors and assigns of the respective Parties to this Agreement. No Party may
assign its interests in or obligations under this Agreement without the written consent of the other
Parties, which consent shall not be unreasonably withheld or delayed.
i. Waivers. Waiver of any breach or default hereunder shall not constitute a
continuing waiver or a waiver of any subsequent breach either of the same or of another provision of
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EXHIBIT I
this Agreement and forbearance to enforce one or more ofthe remedies provided in this Agreement
shall not be deemed to be a waiver ofthat remedy.
j. Attornevs' Fees and Costs. The prevailing Party in any litigation or other
action to enforce or interpret this Agreement shall be entitled to reasonable attorneys' fees, expert
witnesses' fees, costs of suit and other and necessary disbursements in addition to any other relief
deemed appropriate by a court of competent jurisdiction. The costs, salaries, and expenses of the
City Attorney and members of his office, in connection with that action, shall be considered as
attorneys' fees for the purposes of this Agreement.
k. Necessarv Actions. Each Party agrees to execute and deliver additional
documents and instruments and to take any additional actions as may be reasonably required to carry
out the purposes of this Agreement.
1. Representations and Warranties. Each representation and warranty contained
herein or made pursuant hereto shall be deemed to be material and to have been relied upon and shall
survive the execution, delivery and termination of this Agreement.
m. Compliance with Law. In performing their respective obligations under this
Agreement, the Parties shall comply with and conform to all applicable laws, rules, regulations and
ordinances.
n. Third Party Beneficiaries. This Agreement shall not create any right or
interest in any non-Party or in any member of the public as a third party beneficiary.
o. Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed to be an original, but all of which together shall constitute but one
and the same instrument.
p. Notices. All notices, requests, demands or other communications required or
permitted under this Agreement shall be in writing unless provided otherwise in this Agreement and
shall be deemed to have been duly given and received on: (i) the date of service if served personally
or served by facsimile transmission on the Party to whom notice is to be given at the address or
addresses as provided below, (ii) on the first day after mailing, if mailed or dispatched by Federal
Express, U.S. Express Mail, or other similar overnight courier service, postage prepaid and
addressed as provided below, or (iii) on the third (3rd) business day after mailing if mailed to the
Party to whom notice is to be given by first class mail, registered or certified, postage prepaid,
addressed as follows:
To Hillwood:
North San Bernardino Industrial Park, L.P.
c/o Hillwood Development Company, LLC
268 W. Hospitality Lane, Suite 105
San Bernardino, CA 92408
(909) 382-0033
(909) 382-0073 (FAX)
Attn: Michelle Kirk
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EXHIBIT 1
To the City:
City of San Bernardino
300 N. "D" Street
San Bernardino, CA 92401
(909) 384-5122
(909) 384-5138 (FAX)
Attn: City Manager
[SIGNATURES ON FOLLOWING PAGE]
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EXHIBIT 1
IN WITNESS WHEREOF, the Parties hereto have duly executed this Agreement as of
the date first above written.
HILLWOOD:
NORTH SAN BERNARDINO INDUSTRIAL PARK, L.P.,
a California limited partnership
By: Hillwood Fund OPI, LLC,
a Texas limited liability company,
its general partner
By: Hillwood Property Fund, L.P.,
a Delaware limited partnership,
its sole member
By: Hillwood Operating, L.P.,
a Texas limited partnership,
its general partner
By: HilIwood Development Company, LLC,
a Texas limited liability company
its general partner
By:
Name:
Title:
CITY:
CITY OF SAN BERNARDINO, CALIFORNIA
Attest:
By:
By:
Rachel Clark, City Clerk
Lori Sassoon, Acting City Manager
Approved as to Form:
James F. Penman, City Attorney
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F:\WILSON\Agreements\Hillwood Reimbursement Agreement 9.29-08b,doc
DUPLICA TE
Exhibit "A"
Federal EDA Grant Application
and Description of the Grant Project
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DUPLICA TE
Exhibit "B"
The Development Project
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F:\WILSON\A.greements\H.illwood Reimburst'~~nl Agreement 9-29-08b.doc
DUPLlCA TE
Exhibit "C"
Grant Project Related COA's
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DUPLICATE
Exhibit "D"
Form Letter of Credit
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F:\WILSON\A.greements\Hillwood Reimbursement Agreement 9-29-08b.doc
REIMBURSEMENT AGREEMENT WITH HILLWOOD FOR THE FEDERAL
ECONOMIC DEVELOPMENT ADMINISTRATION GRANT - CAJON BOULEVARD
PUBLIC INFRASTRUCTURE IMPROVEMENTS PROJECT FOR HILL WOOD'S NORTH
SAN BERNARDINO INDUSTRIAL PARK PROJECT
This Reimbursement Agreement for the Federal Economic Development Administration
Grant - Cajon Boulevard Improvement Project for Hillwood's North San Bernardino Industrial Park
(this "Agreement"), is entered into and shall be effective as of 2008, by and
between North San Bernardino Industrial Park, L.P. ("Hillwood"), an affiliate of Hillwood
Development Company, LLC, and the City of San Bernardino, a charter city established and existing
pursuant to the Constitution and laws of the State of California and the City Charter (the "City").
Hillwood and the City are each referred to herein as a "Party" and are collectively referred to as the
"Parties.'~
RECITALS
A. The City on behalf of Hillwood has filed an application with the United States
Department of Commerce, Economic Development Administration ("Federal EDA"), for an
economic development infrastructure grant (the "Grant") in the principal amount not to exceed
$1,500,000 based upon an estimated total project cost of $3,750,000 for the construction and
installation on the west half of Cajon Boulevard within the City of San Bernardino adjacent to the
development known as the North San Bernardino Industrial Park (the "Development Proiect"), of
certain roadway widening improvements consisting of approximately 5,452 linear feet in curb and
gutter, and side walk, landscaping, street lights, and traffic signals (such public improvements are
herein referred to as the "Grant Proiect"). It is expected that Hillwood will advance the costs of the
Grant Project for which forty percent (40%) of the eligible costs will be subject to reimbursement by
the Federal EDA in accordance with the documentation required for the Grant Project. The Grant
Project application as approved by the Federal EDA is attached hereto as Exhibit "A" (identified
herein as the "Grant Application") and incorporated herein by this reference; and
B. The City has caused to be prepared the plans, specifications, public bid documents
and public works contracts for the construction of the Grant Project, Hillwood has agreed pursuant
to the terms of this Agreement to advance all costs as required by the City in preparation for the
construction of the Grant Project. Hillwood has agreed, pursuant to the terms of this Agreement, to
remit to the City all costs in accordance with the invoices for the work performed on the Grant
Project by the Public Works Contractor approved by the City. Upon receipt of payments from
Hillwood,the City shall submit the appropriate documentation to the Federal EDA for reimbursement
of the Federal Share of Cost described in the EDA grant award for the Grant Project. Upon receipt
of the Federal Share of Cost from the EDA, the City shall pay over such sum to Hillwood as full and
complete reimbursement for their earlier payment of the costs to the public works contractor; and
C. The Parties seek to memorialize their agreement and understanding on the terms and
conditions under which Hillwood will participate in the preparation of all public works plans,
specifications, and public bid documents for the Grant Project; on which the City will undertake the
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public bidding process and the award of the construction contract for the Grant Project to the lowest
responsive and responsible bidder; and, the terms pursuant to which Hillwood will pay the invoices
submitted by the public works contractor for work in furtherance of the Grant Project.
D. The City previously issued permits for the development and construction of the
Development Project in accordance with certain Conditions of Approval imposed by the City in DP2
No. 06-23 (the "Conditions of Approval"). Certain of the Conditions of Approval relate to the Grant
Project and certain ancillary matters. The Development Project consists of three sites on which
warehouse/distribution buildings and related improvements have been and are in the process of being
constructed. One of those sites (generally shown on the attached Exhibit "B") is the parcel on which
the FedEx building has been completed and now is occupied and in operation and for which the City
has issued a final certificate of occupancy. A second site is referred to on the attached Exhibit B as
"Building One," for which a final certificate of occupancy has also been issued. Improvements on
the remaining site (referred to as "Building Two," as identified on Exhibit "B") are under
construction. Because of the assurances described in this Agreement that the Grant Project and
certain other Conditions of Approval items will be completed, the City is willing to issue the final
certificates of occupancy for Building Two upon satisfaction of all City requirements for a final
certificate of occupancy, notwithstanding that the Grant Project and certain other related Conditions
of Approval items have not been completed, as provided in this Agreement.
Agreements
In furtherance of the Recitals set forth above, the Parties hereby agree as follows:
I. Approval of Public Works Construction Contract.
a. Award of Public Works Construction Contract bv the Citv. The City shall
award the contract (the "Public Works Construction Contract") to the lowest responsive and
responsible bidder (the "Public Works Contractor") and expeditiously commence the construction of
the work described in the Grant Project. The City shall control all aspects of the Public Works
Construction Contract and Hillwood shall have no authority to direct the Public Works Contractor.
Hillwood may provide suggestions to the City staff as to the scope of the Public Works Construction
Contract and as to the manner in which it shall be undertaken and prepared. The City shall not be
required to proceed with any phase or to issue a Notice to Proceed for the Public Works Construction
Contract and commencement of work on the Grant Project until such time as the executed Letter of
Credit (hereinafter defined) has been delivered to the City.
b. Coordination of the Public Works Construction Contract. The City shall
direct the Public Works Contractor in full conformity with the terms of Exhibit "A" in accordance
with public works construction practices. Hillwood staff will be permitted to participate in meetings
conducted by the City staff with the Public Works Contractor. The City shall designate a
management person in the Development Services Department to be the lead City staff person
regarding the preparation of the Public Works Construction Contract and all other public bidding
documentation and the coordination with Hillwood and other participants.
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c. Compliance with Applicable Laws. The City warrants and represents that: (i)
prior to the date of this Agreement it has complied with the provisions of the California
Environmental Quality Act of 1970, as amended ("CEQA"), and will comply with all other
applicable laws, including all requirements of the Federal EDA, for the publication of notices,
undertaking of the competitive bidding process and the approval and award of the Public Works
Construction Contract, and (ii) it will inspect and approve all work performed pursuant to the Public
Works Construction Contract in accordance with all applicable laws and consistent with industry
standards and requirements of the Federal EDA.
d. Final Bids for the Grant Proiect. The City shall forward to Hillwood and the
Federal EDA a copy of the bids as received for the Grant Project and the proposed Public Works
Construction Contract prior to the approval and award by the City for purposes of notifying
Hillwood and obtaining the preliminary consent of the Federal EDA. References in this Agreement
to approval by the Federal EDA are applicable only to the extent such approval is required by
applicable law or regulation.
e. Payment to the City by Hillwood.
(i) Hillwood shall reimburse the City for all of the direct and indirect costs
(including, but not limited to, third party consultants and allocated internal City costs) incurred in
connection with filing, processing and administration of the Grant Application, and the Grant and
fundings under the Grant (the "Grant Costs"). The City shall provide to Hillwood an invoice for the
Grant Costs (with a general description thereof).
(ii) Hillwood shall reimburse the City, and the City shall provide to Hillwood
invoices for the costs incurred by the City based upon invoices received from the Public Works
Contractor for applicable phases in furtherance of the construction and installation of the Grant
Project.
(iii) The City shall prepare and send an invoice to Hillwood for payment to the
City ofthe amounts of the then current outstanding invoices from the Public Works Contractor to the
City and/or for incurred Grant Costs. Hillwood shall pay City by electronic transfer the amounts set
forth therein within fifteen (15) calendar days after receipt of such invoice.
(iv) Time is ofthe essence with respect to the remittance by Hillwood to City of
the Grant Costs and of the payments to be made to the City by Hillwood for payment over to the
Public Works Contractor. The Failure of Hillwood to remit the required amounts as set forth herein
shall be grounds for the City to terminate this Agreement. Any such termination shall be effective
immediately upon delivery of the notice of termination to Hillwood at the address set forth below.
(v) Separate and apart from termination, the failure of Hilllwood to remit the
required sums at the time and in the amounts set forth herein shall be grounds for the City to declare
Hilllwood in default. Upon such declaration of default, the City shall make demand and take
possession of up to and including the full amount ofthe sums held under the Irrevocable Letter of
Credit provided to City pursuant to Section I(i) of this Agreement (the "Proceeds"). The Proceeds
shall thereafter be held by City, interest free, as a deposit for funding of costs which are due and
,
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F:\WILSON\Agreements\Hillwood Reimbursement Agreement 9-29-08b.doc
payable and as may thereafter become due and payable from Hillwood under this Agreement. Prior
to submission of the demand to the holder of the Irrevocable Letter of Credit, City shall provide
Hillwood with written notice of intent to proceed under this subsection. Hillwood shall thereafter
have five (5) calendar days within which to submit the required payments to the City. Upon the
conclusion of the Grant Project, City shall return to Hillwood any portion of the Proceeds not used to
pay Grant Project costs and Grant Costs.
(vi) Hillwood, within ten (10) days afterreceiving written demand therefor from
the City, shall pay to the City any amount by which the unpaid Grant Project costs and Grant Costs
exceed the Proceeds, including costs of any Expanded Services Change Order. The City,
notwithstanding any such failure to remit by Hillwood, may continue the Grant Project, up to and
including completion, and at any time commence action against Hillwood for recovery of the under
payment.
a) The City shall provide Hillwood with a copy of any written request made by the City to the
Public Works Contractor for additional time and/or materials and/or services within five (5)
business days after submittal of the request to the Public Works Contractor or hislherrepresentative.
Any such request shall be for a change order that is within the scope of the Grant Project. Any such
change order will be a written change order (each being referred to as a "Change Order") and on a
time and materials basis as provided in the Public Works Construction Contract. A Change Order
hereunder shall be requested only to the extent as required for the completion of the Grant Project
and subject to the prior approval of the Federal EDA. b) If Change Orderrequests are, I) required
after the date of the award of the Public Works Construction Contract and 2) increase the total cost
of the Grant Project due to an expansion of the scope of services over that described in the the
Public Works Construction Contract (each an "Expanded Services Change Order"), the City shall
authorize such Expanded Services Change Order only with the prior written approval of Hill wood
and the Federal EDA. Upon its approval of the Expanded Services Change Order, Hillwood shall
be liable for payment of the cost of such Expanded Services Change Order, to the City, in the same
amount as for other Grant Project Costs. c) In the event that Hillwood (i) fails to approve a
Change Order request that is within the scope of the Grant Project after approval by the Federal EDA
and/or (ii) to deposit the required dollar amount value of such Change Order with the City within 30
calendar days following approval by the Federal EDA, and iii) the City makes the finding that the
Change Order is necessary for the furtherance of the Grant project, the City shall have the right to
proceed with such Change Order and to require Hillwood to reimburse the City in the amounts of
such Federal EDA approved Change Order as are consistent with Hillwood's share of Grant Project
Costs under this Agreement.
(vii) The City shall present Hillwood with an invoice for the Grant Costs
and Grant Project Costs on a quarterly basis or on such other periodic basis as shall have been
previously agreed to with the Public Works Contractor. Hillwood shall deposit payment for said
invoice to the account of the City by electronic transfer, as shall be designated in writing from the
City to Hillwood, within fifteen (IS) calendar days after Hillwood's receipt of said invoice.
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f. Submittal of Reimbursement Requests to Federal EDA. I) The City agrees to
timely submit to the Federal EDA all reimbursement requests as are in accordance with the Federal
EDA approval of the Grant Project ("Reimbursement Request"). Such Reimbursement Requests
shall be submitted by the City after a payment has been remitted by the City to the Public Works
Contractor for a Grant Project cost, and documentation for receipt of such payment has been
received by the City. Upon receipt from the Federal EDA of the reimbursement ("Reimbursement
Amount") , such amounts shall be held by the City and credited towards the next succeeding
payment request to be submitted to Hillwood for payment of the periodic invoices of the Public
Works Contractor. 2) Upon payment by the City of all invoices as shall be properly submitted by
the Public Works Contractor for payment, the City shall prepare a final reconciliation of all costs of
the Grant Project together with a designation of those amounts, if any, that may be due and owing by
the City to Hillwood. Such sums shall represent any excess funding of the Grant Project costs and
Grant Costs by Hillwood. The dollar amount of such excess funding attributable to Hillwood shall
be remitted by the City to Hillwood within thirty (30) days after authorized representatives of the
Parties have agreed upon the final reconciliation of all such costs of the Federal EDA Grant Project.
g. Insurance. The City shall cause the Public Works Contractor, and all
subcontractors, to carry insurance in substantially the form set forth in the City's public works
contracts, and in Federal EDA Grant Project requirements. Such insurance shall be primary; shall
name Hillwood, its directors, officers, partners, employees, consultants and agents and any persons
who are successors-in-interest to Hillwood as owner of parcels in the Development Project as
additional insureds by endorsement; and shall provide that Hillwood shall be given at least fifteen
(15) calendar days' advance notice in the event of proposed cancellation. The City shall cause the
Public Works Contractor, in addition and all subcontractors, to provide such certificates of insurance
to the City before the Public Works Contractor, or any subcontractor commences any work on the
Grant Project.
h. Conditions of Approval. The issuance by the City of final certificates of
occupancy for Building Two shall be issued and not be delayed due to those items of the Conditions
of Approval set forth on the attached Exhibit "c" (the "Grant Proiect Related COA's") not being
completed. Such delivery is subject to the proviso that all other final certificate of occupancy
requirements for Building Two have been satisfied. Hillwood agrees to complete the work on the
Grant Project Related COA's on a schedule reasonably acceptable to the City that coordinates such
work with the Grant Project work. If Hillwood fails to perform such work in accordance with this
provision, and such failure is not cured within 30 days after Hillwood receives written notice thereof
from the City (or within such longer reasonable period of time due to the nature of such failure,
provided that cure efforts are commenced within said 30-day period and are thereafter diligently
pursued), the City (a) shall have the right to perform such work, and (b) may declare a default, make
demand, and draw down on the Letter of Credit the amount necessary to fund the costs of such work
and utilize those draw proceeds for that purpose.
i. Letter of Credit. I) As security for the payments due by Hillwood under this
Agreement, Hillwood, upon execution of this Agreement, shall deliver to City a letter of credit in the
amount of$3,750,000 in form substantially as set forth on the attached Exhibit "D" and issued by a
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bank reasonably acceptable to the City (the "Letter of Credit"). 2) If Hillwood, by April 20, 2009,
has not made all payments required of it under this Agreement, the City shall have the right to
declare a default, make a demand and draw down under the Letter of Credit Proceeds in the
estimated amount necessary, in the good faith judgment of the City, to pay the remaining amounts
then due and owing by Hillwood and as shall thereafter become due and owing by Hillwood under
this Agreement 3) Without notice or demand from the City, Hillwood shall determine if its
obligation to make payments under this Agreement shall continue past April 30, 2009. Unless
Hillwood, by April 20, 2009, has delivered to the City an extension or replacement of the Letter of
Credit with a revised expiration date reasonably acceptable to the City, City shall declare a default,
make demand and draw down under the Letter of Credit Proceeds in the estimated amount
necessary, in the good faithjudgment of the City, to pay the remaining amounts then due and owing
by Hillwood and as shall thereafter become due and owing by Hillwood under this Agreement
2. Administration of Public Works Construction Contract.
a. General Management and Oversight of the Grant Proiect. The City agrees that
it shall be responsible for the general management and oversight of the preparation of the public
bidding documents, and for the review and approval of all plans and specifications for the Grant
Project submitted by Hillwood to the City. The City shall be responsible for the administration of
all aspects of the Grant Project during the term of the Grant Project. Hillwood shall have no right or
obligation to manage or oversee the activities of the Public Works Contractor in the implementation
and performance of the Public Works Construction Contract except as specifically set forth herein.
b. Indemnification. Each Party agrees and shall indemnify and hold each the
other, its directors, officers, elected officials, employees, agents, authorized volunteers, or
representatives, free and harmless from all claims, demands, actions, damages and liabilities of any
kind and nature arising from bodily injury, including death, violations of right to privacy, or property
damage, based or asserted upon any actual or alleged act or omission of their employees, agents, or
subcontractors, relating to or in any way connected with the performance of the terms of this
Agreement, unless the bodily injury, property damage or other claimed injury was actually caused by
the willful misconduct, sole negligence, or active negligence of the Party, its directors, officers,
elected officials, employees, agents, authorized volunteers, or representatives. As part of the
foregoing indemnity, each Party agrees to protect and defend at its expense, including attorney's
fees, each the other, its directors, officers, elected officials, employees, agents, authorized
volunteers, or representatives, from any and all administrative or other legal actions based upon such
actual or alleged acts or omissions. Each Party hereby waives any and all rights it may have to any
types of express or implied indemnity against the other, their directors, officers, elected officials,
employees, agents, authorized volunteers, or representatives, with respect to third party claims
relating to or in any way connected with the performance of the terms of this Agreement.
3. Administration of Agreement.
a. Books and Records. Each Party shall have access to and the right to examine
the other Party's pertinent books, documents, papers or other records (including, without limitation,
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records contained on electronic media) relating to the performance of that Party's obligations
pursuant to this Agreement. The Parties shall each retain all such books, documents, papers or other
records to facilitate such review. Access to each Party's books and records shall be during normal
business hours only. Nothing in this paragraph shall be construed to operate as a waiver of any
applicable privileges.
b. Disputes. The Parties recognize that there may be disputes regarding the
obligations of the Parties or the interpretation of this Agreement. The Parties agree that they may
attempt to resolve disputes as follows:
(1) Statement Describing Alleged Violation of Agreement. A Party or
Parties alleging a violation of this Agreement (the "Initiating Party" or "Initiating
Parties") shall provide a written statement describing all facts that it believes
constitute a violation of this Agreement to the Party or Parties alleged to have
violated the terms of this Agreement (the "Responding Partv" or the "Responding
Parties").
(2) Response to Statement of Alleged Violation. The Responding Party or
Responding Parties shall have sixty (60) calendar days from the date of the written
statement to prepare a written response to the allegation of a violation of this
Agreement and serve that response on the Initiating Party or Initiating Parties or to
cure the alleged violation to the reasonable satisfaction of the Initiating Party or
Initiating Parties. The Initiating Party or Initiating Parties and the Responding Party
or Responding Parties shall then meet within thirty (30) calendar days after the date
of the response to attempt to resolve the dispute amicably.
(3) Mediation of Dispute. If the Initiating Party or Initiating Parties and
the Responding Party or Responding Parties cannot resolve the dispute within ninety
(90) calendar days after the date of the written response, they shall engage a
mediator, experienced in public works construction disputes, to attempt to resolve
the dispute. Each Party shall ensure that it is represented at the mediation by a
public official or corporate officer. These representatives of the Initiating Party or
Initiating Parties and the Responding Party or Responding Parties may consult with
staff and/or technical consultants during the mediation and such staff and/or
technical consultants may be present during the mediation. The costs of the
mediator shall be divided evenly between the Initiating Party or Initiating Parties
and the Responding Party or Responding Parties.
(4) Reservation of Rights. Nothing in this subsection 3.b shall require a
Party to comply with the dispute resolution process contained herein and each Party
retains and may exercise at any time all legal and equitable rights and remedies it
may have to enforce the terms of this Agreement; provided, that prior to
commencing litigation, a Party shall provide at least five (5) calendar days' written
notice of its intent to sue to all Parties.
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4. General Provisions.
a. Authoritv. Each signatory of this Agreement represents that they are duly
authorized to execute this Agreement on behalf of the Party for which such signatory executes this
Agreement. Each Party represents that it has the appropriate legal authority to enter into this
Agreement and to perform all obligations under this Agreement, including, but not limited to, the
payment of dollar amounts to the other Party as required herein.
b. Amendment. This Agreement may be amended or modified only by a written
instrument executed by each of the Parties to this Agreement and approved by their respective
governing boards.
c. Jurisdiction and Venue. This Agreement shall be governed by and construed
in accordance with the laws of the State of California, except for its conflicts oflaw rules. Any suit,
action or proceeding brought under the scope of this Agreement shall be brought and maintained to
the extent allowed by law in the County of San Bernardino, California.
d. Headings. The paragraph headings used in this Agreement are intended for
convenience only and shall not be used in interpreting this Agreement or in determining any of the
rights or obligations of the Parties to this Agreement.
e. Construction and Interpretation. This Agreement has been anived at through
negotiations and each Party has had a full and fair opportunity to revise the terms of this Agreement.
As a result, the normal rule of construction that any ambiguities are to be resolved against the
drafting Party shall not apply in the construction or interpretation of this Agreement.
f. Entire Agreement. This Agreement constitutes the entire agreement of the
Parties with respect to the subject matter of this Agreement and supersedes any and all prior oral or
written agreement, understanding or representation relating to the subject matter of this Agreement.
g. Partial Invaliditv. If, after the date of execution of this Agreement, any
provision of this Agreement is held to be illegal, invalid or unenforceable under present or future
laws effective during the term of this Agreement, such provision shall be fully severable. However,
in lieu thereof, there shall be added a provision as similar in terms to such illegal, invalid or
unenforceable provision as may be possible and as may be legal, valid and enforceable.
h. Successors and Assigns. This Agreement shall be binding on and inure to the
benefit of the successors and assigns of the respective Parties to this Agreement. No Party may
assign its interests in or obligations under this Agreement without the written consent of the other
Parties, which consent shall not be unreasonably withheld or delayed.
i. Waivers. Waiver of any breach or default hereunder shall not constitute a
continuing waiver or a waiver of any subsequent breach either of the same or of another provision of
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this Agreement and forbearance to enforce one or more of the remedies provided in this Agreement
shall not be deemed to be a waiver of that remedy.
j. Attornevs' Fees and Costs. The prevailing Party in any litigation or other
action to enforce or interpret this Agreement shall be entitled to reasonable attorneys' fees, expert
witnesses' fees, costs of suit and other and necessary disbursements in addition to any other relief
deemed appropriate by a court of competent jurisdiction. The costs, salaries, and expenses of the
City Attorney and members of his office, in connection with that action, shall be considered as
attorneys' fees for the purposes of this Agreement.
k. Necessarv Actions. Each Party agrees to execute and deliver additional
documents and instruments and to take any additional actions as may be reasonably required to carry
out the purposes of this Agreement.
1. Representations and Warranties. Each representation and warranty contained
herein or made pursuant hereto shall be deemed to be material and to have been relied upon and shall
survive the execution, delivery and termination of this Agreement.
m. Compliance with Law. In performing their respective obligations under this
Agreement, the Parties shall comply with and conform to all applicable laws, rules, regulations and
ordinances.
n. Third Party Beneficiaries. This Agreement shall not create any right or
interest in any non-Party or in any member of the public as a third party beneficiary.
o. Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed to be an original, but all of which together shall constitute but one
and the same instrument.
p. Notices. All notices, requests, demands or other communications required or
permitted under this Agreement shall be in writing unless provided otherwise in this Agreement and
shall be deemed to have been duly given and received on: (i) the date of service if served personally
or served by facsimile transmission on the Party to whom notice is to be given at the address or
addresses as provided below, (ii) on the first day after mailing, ifmailed or dispatched by Federal
Express, U.S. Express Mail, or other similar overnight courier service, postage prepaid and
addressed as provided below, or (iii) on the third (3rd) business day after mailing if mailed to the
Party to whom notice is to be given by first class mail, registered or certified, postage prepaid,
addressed as follows:
To Hillwood:
North San Bernardino Industrial Park, L.P.
c/o Hillwood Development Company, LLC
268 W. Hospitality Lane, Suite 105
San Bernardino, CA 92408
(909) 382-0033
(909) 382-0073 (FAX)
Attn: Michelle Kirk
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To the City:
City of San Bernardino
300 N. "0" Street
San Bernardino, CA 92401
(909) 384-5122
(909) 384-5138 (FAX)
Attn: City Manager
[SIGNA TURES ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, the Parties hereto have duly executed this Agreement as of
the date first above written.
HILL WOOD:
NORTH SAN BERNARDINO INDUSTRIAL PARK, L.P.,
a California limited partnership
By: Hillwood Fund GPI, LLC,
a Texas limited liability company,
its general partner
By: Hillwood Property Fund, L.P.,
a Delaware limited partnership,
its sole member
By: Hillwood Operating, L.P.,
a Texas limited partnership,
its general partner
By: Hillwood Development Company, LLC,
a Texas limited liability company
its general partner
By:
Name:
Title:
CITY:
CITY OF SAN BERNARDINO, CALIFORNIA
Attest:
By:
By:
Rachel Clark, City Clerk
Lori Sassoon, Acting City Manager
Ap roved as to Form:
ity Attorney
II
F:\ WILSON\Agreements\Hillwood Reimbursement Agreement 9-29-08b.doc
Exhibit "A"
Federal EDA Grant Application
and Description of the Grant Project
12
F:\ WILSON\Agreements'lJ-lillwood Reimbursement Agreement 9.29-0&b.doc
21lDB rlAR 19 ArlI0 00
U.S. DEPARTMENT OF COMMERCE
Economic Development Administration
Jackson Federal Building, Room 1890
915 Second Avenue
Seattle, Washington 98174
Fax: (206) 220-7669
In reply refer to:
Investment No.: 07-01-06147
March 14, 2008
The Honorable Partrick 1. Moms
Mayor, City of San Bernardino
300 North D Street
San Bernardino, California 92418
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Dear Mayor Moms:
I am pleased to inform you that the Department of Commerce's Economic Develop~erft'
Administration (EDA) has approved your application for a $1,500,000 EDA investment in-otreet
improvements to Cajon Boulevard to support planned industrial development in North San
Bernardino.
=-:-")
. ,
__J
Enclosed are three signed copies of the Financial Assistance Award. Your agreement to
the terms and conditions of the award should be indicated by the signature of your principal
official on each ofthe signed copies of the Financial Assistance Award. Two of the executed
copies should be returned to A. Leonard Smith, Regional Director, EDA Seattle Regional Office,
915 Second Avenue, Room 1890, Jackson Federal Building, Seattle, Washington 98174. Ifnot
signed and returned within 30 days of receipt, EDA may declare the Award null and void.
Please do not make any commitments in reliance on this award until you have carefully
reviewed and accepted the terms and conditions. Any commitments entered into prior to
obtaining the approval of ED A in accordance with its regulations and requirements will be at
your own risk.
EDA's mission is to lead the federal economic development agenda by promoting
innovation and competitiveness, preparing American regions for growth and success in the
worldwide economy. EDA implements this mission by making strategic investments in the
nation's most economically distressed communities that encourage private sector collaboration
and creation of higher-skill, higher wage jobs. EDA investments are results driven, embracing
the principles of technological innovation, entrepreneurship and regional development.
I share your expectations regarding the impact of this investment and look forward to
working with you to meet the economic development needs of your community.
Sincerely,
mth
egional Director
Enclosures
FORM CD-4SO
(REV 10-04)
(CD450.~PW)
U.S. DEPARTMENT OF COMMERCE
Iil GRANT 0 COOPERATIVE AGREEMENT
FINANCIAL ASSISTANCE AWARD
ACCOUNTING CODE
20084020010021041101600
RECIPIENT NAME
City of San Bernardino
AWARD NUMBER
07-01-06147
STREET ADDRESS
300 North D Street
FEDERAL SHARE OF COST $
1,500,000
CITY, STATE,ZIP CODE San Bernardino, California 92418-0001
RECIPIENT SHARE OF COST $
2,250,000 .
AWARD PERIOD From date of approval shown below through 60 months
TOTAL ESTIMATED COST $
3,750,000
DEPARTMENT OF COMMERCE OPERATING UNIT Economic Development Administration
AUTHORITY 42 U.S.C. Section 3141, et seq. Public Works and Economic Development Act, as amended
by Public Law 108-373.
CFDA NO.
11.300 PROJECT TITLE: Public Works and Economic Development Facilities Program
BUREAU FCFY
20 08
FUND
40
PROGRAM CODE
01
BUDGET SUBACTIVITY
210
OBJECT 1
41
CLASS EXPEND
10
ENTITY
16
This Award approved by the Grants Officer is issued in triplicate and constitutes an obligation of federal funding.
By signing the three documents, the Recipient agrees to comply with the Award provisions checked below and
attached. Upon acceptance by the Recipient. two signed Award documents shall be returned to the Grants Officer
and the third document shall be retained by the Recipient. If not signed and returned without modification by the
Recipient within 30 days of receipt, the Grants Officer may unilaterally terminate this Award.
[Xl EDA Standard Terms and Conditions Public Works and Implementation Construction Components, dated 10/2007
[Xl Special Award Conditions and Attachments
[Xl Line Item Budget
[Xl 15 CFR Part 24, Uniform Admin Requirements for Grants/Cooperative Agreements to State & Local Governments
[Xl OMB Circular A-87, Cost Principles for State and Local Governments and Indian Tribal Governments
[Xl OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations
o 15 CFR. Part 14, Uniform Administrative Requirements for Grants and Agreements with Institutions of Higher
Education, Hospitals, Other Nonprofit, and Commercial Organizations
o OMB Circular A-122, Cost Principles for Nonprofit Organizations
o OMB Circular A-21, Cost Principles for Educational Institutions
o EDA Standard Terms and Conditions Capacity Building Programs
o Department of Commerce Financial Assistance Standard Terms and Conditions, dated 01/05
NAME A. Leonard Smith
TITLE Regional Director
DATE
Mar 14, 2008
OF AUTHORIZED RECIPIENT OFFICIAL
TYPED NAME AND TITLE
DATE
FORM CD-4S0 U.S. DEPARTMENT OF COMMERCE liJ GRANT o COOPERATIVE AGREEMENT
(REV lC-04)
(CQ450.1P\N)
FINANCIAL ASSISTANCE AWARD ACCOUNTING CODE
20084020010021041101600
.
RECIPIENT NAME City of San Bernardino AWARD NUMBER
07-01-06147 I
STREET ADDRESS 300 North D Street FEDERAL SHARE OF COST $ 1,500,000
CITY, STATE, ZIP CODE San Bernardino, California 92418-0001 RECIPIENT SHARE OF COST $ 2,250,000
AWARD PERIOD From date of approval shown below through 60 months TOTAL ESTIMATED COST $ 3,750,000
DEPARTMENT OF COMMERCE OPERATING UNIT Economic Development Administration
AUTHORITY 42 U.S.C. Section 3141, et seq. Public Works and Economic Development Act, as amended
by Public Law 108-373.
CFDA NO. 11.300 PROJECT TITLE: Public Works and Economic Development Faclllties Program
BUREAU FCFY FUND PROGRAM CODE BUDGET SUBACTIVrrv OBJECT 1 CLASS EXPEND ENTITY
20 08 40 01 210 41 10 16
This Award approved by the Grants Officer is issued in triplicate and constitutes an obligation of federal funding.
By signing the three documents, the Recipient agrees to comply with the Award provisions checked below and
attached. Upon acceptance by the Recipient, two signed Award documents shall be returned to the Grants Officer
and the third document shall be retained by the Recipient. If not signed and returned without modification by the
Recipient within 30 days of receipt, the Grants Officer may unilaterally terminate this Award.
IX] EDA Standard Terms and Conditions Public Works and Implementation Construction Components, dated 10/2007
IX] Special Award Conditions and Attachments
IX] Line Item Budget
IX] 15 CFR Part 24, Uniform Admin Requirements for Grants/Cooperative Agreements to State & Local Governments
IX] OMB Circular A-87, Cost Principles for State and Local Governments and Indian Tribal Governments
IX] OMS Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations
0 15 CFR, Part 14, Uniform Administrative Requirements for Grants and Agreements with Institutions of Higher
Education, Hospitals, Other Nonprofit, and Commercial Organizations
0 OMS Circular A-122, Cost Principles for Nonprofit Organizations
0 OMS Circular A-21, Cost Principles for Educational Institutions
0 EDA Standard Terms and Conditions Capacity Building Programs
0 Department of Commerce Financial Assistance Standard Terms and Conditions, dated 01/05
SIG~?Z DEP~RTME:J:lR:i!'S NAME A. Leonard Smith DATE
OFFICER'iY" TITLE Regional Director Mar 14, 2008
.'. . '''//1 /~ / i t7/.. .f (//
/ .~y
SIGNATURE'OF AUTHORIZED RECIPIENT OFFICIAL TYPED NAME AND TITLE DATE
I
FORMC0..4S0 U.S. DEPARTMENT OF COMMERCE 6J GRANT o COOPERATIVE AGREEMENT ,
(REV 10-04)
(CD450-1PW) ,
FINANCIAL ASSISTANCE AWARD ACCOUNTING CODE
20084020010021041101600 I
RECIPIENT NAME City of San Bernardino AWARD NUMBER
07-01-06147
STREET ADDRESS 300 North D Street FEDERAL SHARE OF COST $ 1,500,000
CITY, STATE, ZIP CODE San Bernardino, California 92418-0001 RECIPIENT SHARE OF COST $ 2,250,000
AWARD PERIOD From date of approval shown below through 60 months TOTAL ESTIMATED COST $ 3,750,000
DEPARTMENT OF COMMERCE OPERATING UNIT Economic Development Administration
AUTHORITY 42 U.S.C. Section 3141, et seq. Public Works and Economic Development Act, as amended
by Public Law 108-373.
CFDA NO. 11.300 PROJECT TITLE: Public Works and Economic Development Facilities Program
BUREAU FCFY FUND PROGRAM CODE BUDGET SUBACTIVITY OBJECT 1 CLASS EXPEND ENTITY
20 08 40 01 210 41 10 16
This Award approved by the Grants Officer is issued in triplicate and constitutes an obligation of federal funding.
By signing the three documents, the Recipient agrees to comply with the Award provisions checked below and
attached. Upon acceptance by the Recipient, two signed Award documents shall be returned to the Grants Officer
nd the third document shall be retained by the Recipient. If not signed and returned without modification by the
Recipient within 30 days of receipt, the Grants Officer may unilaterally terminate this Award.
!Xl EDA Standard Terms and Conditions Public Works and Implementation Construction Components, dated 10/2007
!Xl Special Award Conditions and Attachments
!Xl Line Item Budget
!Xl 15 CFR Part 24, Uniform Admin Requirements for Grants/Cooperative Agreements to State & Local Governments
!Xl OMB Circular A-87, Cost Principles for State and Local Governments and Indian Tribal Governments
!Xl OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations
0 15 CFR, Part 14, Uniform Administrative Requirements for Grants and Agreements with Institutions of Higher
Education, Hospitals, Other Nonprofit, and Commercial Organizations
0 OMB Circular A-122, Cost Principles for Nonprofit Organizations
0 OMB Circular A-21, Cost Principles for Educational Institutions
0 EDA Standard Terms and Conditions Capacity Building Programs
0 Department of Commerce Financial Assistance Standard Terms and Conditions, dated 01/05
SIGNATURE OF DEPARTMEN:ll;c7 NAME A. Leonard Smith DATE
OFFICnt '//' ",.', TITLE Regional Director Mar 14, 2008
. Zb'.//i/l/ ^ . '/.i:;";'
-IGNATU~y6F AUTHORIZED ~ECIP;ENT OFFICI~L TYPED NAME AND TITLE DATE
I
Form ED-50S
(Rev. 7/07)
U.S. DEPARTMENT OF COMMERCE ATT ACHMENT NO. I
ECONOMIC DEVELOPMENT ADMINISTRATION
PUBLIC WORKS PROJECT COST CLASSIFICATIONS
EDA Award No. 07-01-06147
State: California
County: San Bernardino
Cost Classification
Proposed
Approved
Administrative and legal expenses $ 20,000 $ 20,000
Land, structures and rights-of-way 5,000 5,000
appraisals, etc.
Relocation expenses and payments 1,000 1,000
Architectural and engineering fees 155,000 -0-'
Other architectural and engineering fees 37,000 37,000
Project inspection fees 275,000 275,000
Site work -0- -0-
Demolition and removal -0- -0-
Construction 2,935,000 3,090,000'
Equipment -0- -0-
Contingencies 322,000 322,000
TOTAL PROJECT COSTS
$
3,750,000
$
3,750,000
I Architectural/Engineering fees are not eligible because an NE has already been contracted and the design
work has been started. The $155,000 has been moved from NE Fees to Construction cost classification.
EXHIBIT "A"
u.s. DEPARTMENT OF COMMERCE
Economic Development Administration
Page 1 of 3
Public Works and Development Facilities
RECIPIENT:
City of San Bernardino, San Bernardino County,
California
Award No. 07-01-06147
SPECIAL AWARD CONDITIONS
1. PROJECT DEVELOPMENT TIME SCHEDULE: The Recipient agrees to the following
Project development time schedule:
Time allowed after receipt of Financial Assistance A ward for:
Return of Executed Financial Assistance Award
- 30 days
Time allowed after acceptance by Recipient of Financial Assistance Award for:
Start of Construction
Construction Period
23
- 30
months
months
Project Closeout - All Project closeout documents, including final financial information and
any required program reports, shall be submitted to the Government not more than 90 days
after the date the Recipient accepts the completed Project from the contractor(s).
The Recipient shall pursue diligently the development of the Project so as to ensure
completion of the Project and submission of closeout documents within this time schedule.
Moreover, the Recipient shall notify the Government in writing of any event which could
delay substantially the achievement of the Project within the prescribed time limits. The
Recipient further acknowledges that failure to meet the development time schedule may
result in the Government's taking action to terminate the Award in accordance with the
regulations set forth at 13 CFR 305.99(b) and 15 CFR 24.43 (53 Fed. Reg. 8048-9, 8102,
March 11,1988).
2. GOALS FOR WOMEN AND MINORITIES IN CONSTRUCTION: Department of
Labor regulations set forth in 41 CFR 60-4 establish goals and timetables for participation of
minorities and women in the construction industry. These regulations apply to all Federally
assisted construction contracts in excess of $1 0,000. The Recipient shall comply with these
regulations and shall obtain compliance with 41 CFR 60-4 from contractors and
subcontractors employed in the completion of the Project by including such notices, clauses
and provisions in the Solicitations for Offers or Bids as required by 41 CFR 60-4. The goal
for the participation of women in each trade area shall be as follows:
From April I, 198 I, until further notice: 6.9 percent
Exhibit "A" Page 2 of 3
Special Award Conditions
Award No: 07-01-06147
City of San Bernardino, CA.
All changes to this goal, as published in the Federal Register in accordance with the Office of
Federal Contract Compliance Programs regulations at 41 CFR 60-4.6, or any successor
regulations, shall hereafter be incorporated by reference into these Special A ward Conditions.
Goals for minority participation shall be as prescribed by Appendix B-80, Federal Register,
Volume 45, No. 194, October 3, 1980, or subsequent publications. The Recipient shall
include the "Standard Federal Equal Employment Opportunity Construction Contract Spec-
ifications" (or cause them to be included, if appropriate) in all federally assisted contracts and
subcontracts. The goals and timetables for minority and female participation may not be less
than those published pursuant to 41 CFR 60-4.6.
3. TITLE: Prior to EDA authorization to start construction, the Recipient shall provide
evidence satisfactory to the Government that the Recipient has acquired good and
merchantable title, free of all mortgages, forec1osable liens, or encumbrances, to all land,
rights-of-way, and easements necessary for the completion of the Project.
4. FEDERAL SHARE OF PROJECT COSTS: The EDA participation in total eligible
project costs will be limited to the EDA grant amount or the EDA share of total allowable
project costs based on the area's grant rate eligibility at the time of award, whichever is less.
5. REPORT ON UNLIQUIDATED OBLIGATIONS: If there is an EDA grant award of more
than $100,000 which has not been fully disbursed (or disbursed and closed out) as of
September 30 each year the recipient must submit OMB Standard Form 269A, Financial
Status Report, to EDA annually on the status of unreimbursed obligations. The report will
provide information on the amount of allowable project expenses that have been incurred by
the Recipient but not claimed for reimbursement as of September 30. The report must be
submitted to EDA no later than October 30 of each year. Noncompliance with this
requirement will result in the suspension of ED A grant disbursements. EDA will furnish
instructions for completing and filing the report to all recipients at least 60 days before the
report is due.
6. GRANT SUSPENSION FOR FAILURE TO START CONSTRUCTION: Ifsignificant
construction (as determined by EDA) is not commenced within two years of approval of the
project or by the date estimated for start of construction in the grant award (or the expiration
of any extension granted in writing by EDA), whichever is later, the EDA grant will be
automatically suspended and may be terminated if EDA determines, after consultation with
the grant recipient, that construction to completion cannot reasonably be expected to proceed
promptly and expeditiously.
7. PRESERVATION OF OPEN COMPETITION AND GOVERNMENT NEUTRALITY
TOW ARDS GOVERNMENT CONTRACTORS' LABOR RELATIONS ON FEDERAL
AND FEDERALLY FUNDED CONSTRUCTION PROJECTS: Pursuant to E.O. 13202,
unless the project is exempted under section 5( c) of the order, bid specifications, project
Exhibit "A" Page 3 of 3
Special Award Conditions
Award No: 07-01-06]47
City of San Bernardino, CA.
agreements, or other controlling documents for construction contracts awarded by recipients
of grants or cooperative agreements, or those of any construction manager acting on their
behalf, shall not: a) include any requirement or prohibition on bidders offerors, contractors,
or subcontractors about entering into or adhering to agreements with one or more labor
organizations on the same or related construction project(s); or b) otherwise discriminate
against bidders, offerors, contractors, or subcontractors for becoming or refusing to become
or remain signatories or otherwise to adhere to agreements with one or more labor
organizations, on the same or other related construction projects(s).
8. PROPERTY MANAGEMENT STANDARDS: In affirming this Award, the
Recipient/Owner acknowledges its responsibility to use the real property acquired, benefitted,
or improved in whole or in part with this investment assistance for the North San
Bernardino Industrial Park and to comply with the Economic Development
Administration Reauthorization Act of2004 (Public Law 108-373) interim final rule to
reflect the amendments made to EDA's authorizing statute, the Public Works and Economic
Development Act of 1965, and \3 CFR PART 314-PROPERTY Subpart B-Real Property
314.7 Title.
9. CALIFORNIA STATE HISTORIC PRESERVATION OFFICER (SHPO) - Prior to the start
of construction, the Recipient shall provide evidence satisfactory to EDA that the California
SHPO has reviewed this Federally-assisted project for its potential to affect cultural or
historic resources. Identification of any potential for impact on properties on or eligible for
listing on the National Register of Historic Places will create a requirement for additional
consultation and/or management action, per Section 106 of the National Historic Preservation
Act and 36 CFR Part 800.
10. US FISH and WILDLIFE SERVICE (USFWS) COORDINATION - Prior to the start of
construction, the Recipient shall provide evidence satisfactory to EDA that a consultation
process with the USFWS, initiated by the City of San Bernardino on behalf of EDA, has been
completed to determine the potential direct and/or indirect impact on species of plants and
animals listed for protection under the Endangered Species Act (ESA). Identification of
impact to, or a potential for impact to, species listed under the ESA, may create a requirement
for additional consultation or other management activities per the ESA, Section 7 and 50
CFR Part 402.
II. CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) COMPLIANCE - Prior to the
start of construction, the Recipient shall provide evidence satisfactory to EDA that the
requirements of the CEQA have been completed by the designated "Lead Agency" (or
agencies, if applicable) for this specific project and that the appropriate "Notice of
Determination" has been filed per CEQA, Public Resources Code Section 21108 et seq and
CEQA Guidelines, Section 15075 or 15094 as appropriate.
o -; - C I - () C, (l-i f
C I fJ c+ S (II) 13hncWtljvIl) ell,
U.S. DEPARTMENT OF COMMERCE
ECONOMIC DEVELOPMENT ADMINISTRATION
STANDARD TERMS AND CONDITIONS
FOR CONSTRUCTION PROJECTS
Title II
Public Works and Economic Development Facilities
and
Economic Adjustment Assistance Construction Components
OCTOBER 2007
(as amended on December 13,2007)
C.S. DEPARTMENT OF COMMERCE
ECONOMIC DEVELOPMEJI;T ADMINISTRATIOJl;
STANDARD TERI\1S AND CONDITIONS
FOR CONSTRUCTION PROJECTS
Title II
Public Works and Economic Development Facilities
and
Economic Adjustment Assistance Construction Components
PREFACE .............
.... ...... ..... .... ... ... ....... ................... ..... ....................... .................... .................. I
A. Genera] Requirements and Respons ibi I ities................................................ ........... ................. ....... ..........2
I. Purpose................... ....... ............ ... .......... .... ......... .... ............... .... ................ ............... ...... ................... 2
2. A uthority and Pol icies ........................................................................... ............... ........... ..... ....... ... ....2
3. Defin itions ............ .......... .... .......... ........... ...... ............ .................... ... ...................... .................... ........3
4. Grant Recipient as Trustee ........ ............. .... ........................................................................................3
B. Financial Requirements. ....... ............. ............................... .................... ...... .......... ........... ............. ............3
]. Financial Reports....................... ........ .... ........... ......................... .................... ................................. ... 3
2. Di sbursement Requests. ........................................... ............................ ....................................... .......4
3. Federal and Non-Federal Cost Sharing. .............................................................................................4
4. Budget Revisions and Transfers of Funds Among Budget Categories .............................................. 5
5. I nd irect Costs....... ....... ...................................... .................................................................................. 6
6. Incurring Costs Prior to Award ..........................................................................................................7
7. Incurring Costs or Obligating Funds Beyond the Project Expiration Date ........................................ 7
8. Time Extensions......... ............................................. ....................................................... ............. ....... 8
9 . Tax Refunds ............ .......... ....................................................... ..... ........................................... ....... ...8
10. Program Income ......... ......... .................................................... .................... ............. ..........................9
C. Programmatic Requirements. .......... ........................... ................ ........ ...... .................. ....... ........ ............... 9
I . Quarterly Reporting.... ................................ ............. .......................... .............. ............ ................ ....... 9
2. I nterim Reporting.. .......... ........................................... ....... ....... ................................................. ......... 9
3. Government Performance and Results Act Reporting .....................................................................10
4. Unsatisfactory Performance .................................................... ........ ...................................... ........... 10
5. Programmatic Changes.. ...... ..... ....... ............................ ......... .... ............. ................ ............ .... ... ........ 10
6. Other Federal Awards with Similar Programmatic Activities .........................................................]0
7. Noncompliance with Award Provisions ...........................................................................................10
8. Use by Beneficiary ...........................................................................................................................]]
9. Prohibition Against Assignment by the Recipient ...........................................................................11
10. Disclaimer Provisions: Hold Harmless Requirement.......................................................................11
II
II. Prohibition on Use of Third Parties to Secure Award..................................................................... 12
12. Payment of Anorneys' or Consultants' Fees....................................................................................12
13. Commencement of Construction. ........................................................................................... .......... 12
14. Efficient Administration of Project .................................................................................................12
15. Conflicts-of-Interest Rules. ........ ............................................................................................ """'''' 13
16. Record-Keeping Requirements. ......................................................................................................13
I 7. Termination Actions. ....................................................................... ............................. ................... ] 4
18. Project Closeout Procedures.............. '...... .................... .................................................................... 14
D. Additional Requirements Relating to Construction Projects. ................................................................ 16
I. The Davis-Bacon Act, as amended (40 U.S.e. SS 3141-3144, 3146, 3147; 42 U.S.e. S 3212)......16
2. The Contract Work Hours and Safety Standards Act, as amended (40 USe. SS 3701 - 3708) .... 16
3. The National Historic Preservation Act of 1966, as amended (16 U.S.e. S 470 et seq.),
and the Advisory Council on Historic Preservation Guidelines....................................................... 16
4. The Historical and Archeological Data Preservation Act of 1974, as amended
(16 USe. S 469a-1 et seq.) ............................................................................................................. 16
5. Architectural Barriers Act of 1968, as amended (42 U.S.e. S 4151 et seq.) ...................................16
6. The Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970,
as amended (42 USe. S 4601 et seq.)............................................................................................. 16
7. The Energy Conservation and Production Act (42 U.S.e. S 6834 et seq.) ......................................16
8. Requirements for New Construction................................................................................................17
E. Non-Discrimination Requirements...... ................................................. ..... ............................................. 17
1. Statutory Provisions. ........................................................................................................................17
2. Other Prov isions. ..... ............................................................................................. ............................17
3. Title VII Exemption for Religious Organizations. ........................................................................... 18
F. Audits............... ....................... .......... ........... ....................... ................................................................... 1 8
I. Requirement to Have an OMB Circular A-133 Audit Performed; Organization-Wide,
Program-Specific, and Project Audits ..............................................................................................18
2. Requirement to Submit Audit to EDA .............................................................................................] 9
3. Audit Resolution Process .................................................................................................................19
G. Debts................................................................................ ........ ..................... .......................................... 20
I. Payment of Debts Owed the Federal GovernmenL.........................................................................20
2. Late Payment Charges.............................................. ........................................................................20
3. Barring Delinquent Federal Debtors from Obtaining Federal Loans or
Loan Insurance Guarantees.............................................................................................................. 20
4. Effect of Judgment Lien on Eligibility for Federal Grants, Loans, or Programs. ............................2]
H. Name Check Reviews. ............... ................. ....................................................... .................................... 21
I. Name Check Requirement..................... ................... .............................................................. ..........21
2. Exemptions..................................... .......................... ........................ ....... .........................................21
III
3. Results of Name Checks.. ............................................ ...... ............. ................... ........... .................... 21
4. Action(s) Taken as a Result of Name Check Review .....................................................................2]
I. Governmentwide Debarment and Suspension (Non-procurement) .......................................................22
J . Drug-free Workplace........................................................................................................................ ......22
K. Lobby ing Restrictions. ............ ............................................. ............. .......... .... ..................... .......... ..... ... 22
I. Statutory Provisions. ............................. ...... ......................................... ............... ......... ....................22
2. Disc losure of Lobby ing Activ ities ................................. ............................. ......... ........... ................. 22
3. Special Provisions Relating to Indian Tribes ...................................................................................22
L. Codes of Conduct and Subaward. Contract. and Subcontract Provisions..............................................22
I. Code of Conduct for Recipients ..... .............................. .................................................................... 22
~ Applicability of Award Provisions to Subrecipients........................................................................23
3. Competition and Codes of Conduct for Subawards .........................................................................23
4. Applicability of Provisions to Subawards, Contracts, and Subcontracts. ........................................24
5. Minority-Owned Business Enterprise............... ........ .................... .......................... .........................24
6. Subaward and/or Contract to a Federal Agency...............................................................................25
7. EDA Contracting Provisions for Construction Projects...................................................................25
M. Property.... ... ............. .......... ..... .... ................................................................. .... ................... .............. ..... 25
I . Standards............................ ..... ................................................................................................... ......25
2. Retention of Tit Ie... .... ............................. ....... ...................................................... ....... .......... ............ 25
3. EDA's Interest in Award Property ...................................................................................................25
4. I nsurance and Bonding................ ......... ....... ........................... ........................... .................. ..... ... ..... 27
5. Leasing Restrictions.... ..................................................................................................................... 27
6. Use of Eminent Domain Prohibited .................................................................................................27
7. Disposal of Real Property...... ................................. ................................................................. .........28
N. Environmental Requirements. ................. .................... ......... ... ......................................... ......................28
I. The National Environmental Policy Act of 1969 (42 U.s.e. 94321 et seq.) ..................................28
2. Environmental Quality Improvement Act of 1970, as amended (42 U.s.e. 994371 - 4375) ........29
3. Executive Order] 2088, "Federal Compliance with Pollution Control Standards,"'
(43 Fed. Reg. 47707, October ]3,1978), as amended .....................................................................29
4. Executive Order] 1514, "Protection and Enhancement of Environmental Quality,"
(35 Fed. Reg. 4247, March 5, 1970), as amended............................................................................29
5. Executive Order] ]593. "Protection and Enhancement of the Cultural Environment,"
(36 Fed. Reg. 8921, May ]3, ]971), as amended.............................................................................29
6. Clean Air Act, Clean Water Act, and Executive Order 11738.........................................................29
7. The Safe Drinking Water Act of 1974, as amended (42 U.s.e. 9 300f et seq.)...............................29
8. Executive Order 11988, "Floodplain Management," (42 Fed. Reg. 26951, May 24, ] 977) and
Executive Order I] 990, "Protection o.{Wetlands," (42 Fed. Reg. 26961, May 24, 1977)..............29
IV
9. The Flood Disaster Protection Act of] 973, as amended (42 USe. 94002 et seq.),
and regulations and guidelines issued thereunder by the U.S. Federal Emergency Management
Administration ("FEMA") or by EDA ........................................................ ............. ........................ 29
10. The Coastal Zone Management Act of 1972, as amended (] 6 USe. 9 1451 et seq.) ....................30
II. The Coastal Barrier Resources Act, as amended, (16 USe. 9 350 I et seq.) ..................................30
12. The Wild and Scenic Rivers Act, as amended. (16 USe. 91271 et seq.)......................................30
13. The Fish and Wildlife Coordination Act, as amended. (]6 USe. 9 66] et seq.) ...........................30
14. The Endangered Species Act of 1973, as amended, (16 USe. 91531 et seq. ...............................30
15. The Comprehensive Environmental Response, Compensation, and Liability Act of 1980
("CERCLA") (42 U.S.e. 99601 et seq.), as amended by the Superfund Amendments
and Reauthorization Act of 1986 (42 U.S.e. 99662 et seq.)...........................................................30
16. The Resource Conservation and Recovery Act of 1976, as amended, (42 U.S.e. 9 690] et seq.).. 30
17. Executive Order] 2898, "Federal Actions to Address Environmental Justice in Minority
Populations and Low-Income Populations" (59 Fed. Reg. 7629, February I], ]994)....................30
18. The Lead-Based Paint Poisoning Prevention Act, as amended, (42 U.S.e. 94821 et seq.)............ 30
]9. The Fannland Protection Policy Act, as amended, (7 Use. 99420] - 4209)...............................30
20. The Noise Control Act of 1972, as amended, (42 USe. 9 490] et seg.)........................................3l
21. The Native American Graves Protection and Repatriation Act, as amended,
(25 U.S.e. 93001 et seq.) ..............................................................................................................31
O. Compliance with Environmental Requirements..... ................................................................................ 31
P. M isce Ilaneous Requ irements.......... ........................................................................................................ 3 I
I. Criminal and Prohibited Activities...................................................................................................31
2 . Foreign T rave I. ......................................... ............ ............................................................................ 3 ]
3. American-Made Equipment and Products .......................................................................................32
4. I ntellectual Property Rights.............................................................................................................. 32
5. Increasing Seat Belt Use in the United States .................................................................................34
6. Research Involving Human Subjects. ..............................................................................................34
7 . Federal Employee Expenses............................................................................................................. 35
8. Preservation of Open Competition and Government Neutrality Towards Government
Contractors' Labor Relations on Federal and Federally-Funded Construction Projects..................35
9 M' . S . I . . ("MSI") I .. .
. monty ervmg nstltutlOns s nltlatlve ............................................................................35
] O. Research Misconduct ................... ............ ........ ................................................................................ 35
]]. Publications, Videos, and Acknowledgment of Sponsorship...........................................................36
12. Care and Use of Live Vertebrate Animals .......................................................................................36
13. Homeland Security Directive .................. ......................................................................................... 36
14. Compliance with Department of Commerce Bureau of Industry and Security Export
Adm in istration Regu lations.............................................................................................................. 3 7
A PPEN D IX ................... ......... ............................................... ..... ................. .................................................38
v
PREFACE
Terms and Conditions of the Award. This financial assistance award on Form CD-450 (this "Award"),
executed by the Economic Development Administration CEDA ") and the Recipient, together with the
EDA-approved project budget and scope of work, these construction standard terms and conditions,
special award conditions, and all applicable federal statutory and regulatory requirements as incorporated
by reference (e.g., all applicable statutes, regulations, Executive Orders, and Office of Management and
Budget (OMB) Circulars), constitute the complete requirements, hereinafter referred to as the "Terms and
Conditions," applicable to the EDA investment.
The Recipient and any subrecipient must, in addition to the assurances made as part of the application for
investment assistance, comply with and require each of its contractors and subcontractors employed in the
completion of the project to comply with the Terms and Conditions of this Award.
This Award is subject to the laws and regulations of the United States. Any inconsistency or conflict in
the Terms and Conditions specified in this Award will be resolved according to the following order of
precedence: public laws, regulations (including applicable notices published in the Federal Register),
Executive Orders, OMB Circulars, EDA's construction standard terms and conditions, and special award
conditions. A special award condition may take precedence on a case-by-case basis over a construction
standard term or condition when warranted by specific project circumstances.
Some of EDA' s construction terms and conditions herein contain, by reference or substance, a summary
of the pertinent statutes or regulations published in the Federal Register or the Code of Federal
Regulations CC.F.R,"), Executive Orders, OMB Circulars, or the assurances required of the Recipient
(See Forms SF-424B and SF-424D). To the extent that it is a summary, such provision is not in
derogation of, or an amendment to, any such statute, regulation, Executive Order, OMB Circular, or
assurance.
ECONOMIC DEVELOPMENT ADMINISTR:\ nON
STANDARD TERMS AND CONDITIONS
FOR CONSTRUCTION PROJECTS
Title II - Public Works and Economic Development Facilities
and
Title II - Economic Adjustment Construction Components
A. General Requirements and Responsibilities.
I. Purpose. The Economic Development Administration's ("EDN') grants for (i) public works
(42 U.S.e. S 3141) and (ii) economic adjustment (42 U.S.e. S 3149) projects are designed to
enhance regional competitiveness and promote long-term economic development in regions
experiencing substantial economic distress. EDA provides construction, design, and
engineering grants to assist distressed communities and regions revitalize, expand, and upgrade
their physical infrastructure to attract new industry, encourage business expansion, diversify
local economies, and generate or retain long-term private sector jobs and investment. The
requirements set forth in these construction standard terms and conditions (the "Construction
Standard Terms and Conditions") are applicable to construction, design, and engineering
projects funded in whole or in part by EDA. Any necessary modifications of these
requirements will be addressed in special award conditions to accommodate individual
projects. In addition, these Construction Standard Terms and Conditions apply to construction
projects ofrevolving loan funds ("RLFs") awarded between 1975 and I 999 under EDA:s Title
IX Economic Adjustment Assistance Program, as well as to RLFs funded after February I I,
1999 under section 209 ofPWEDA (42 U.S.e. S 3149).
2. Authority and Policies. EDA is a bureau within the U.S. Department of Commerce
established under the Public Works and Economic Development Act of 1965, as amended
(42 USe. S 3121 etseq.)("PWEDA"). (See also 13 e.F.R. S 300.1.) Asa federal agency,
EDA is obligated to promulgate regulations and establish policies and procedures to:
a. Ensure compliance with applicable federal requirements;
b. Safeguard the public's interest in the grant assets; and
c. Promote the effective use of grant funds in accomplishing the purpose(s) for which they
were awarded.
The Department or EDA may issue changes from time to time to the regulations and other
requirements and policies that apply to this Award. Such changes may upon occasion increase
administrative or programmatic flexibility in administering this Award in a manner that is
mutually beneficial to EDA and to the Recipient. The implementation of any such regulatory,
administrative, or programmatic change in administering this A ward must have prior EDA
written approval.
EDA's policy is to administer all Awards uniformly; however, there may be special
circumstances that warrant a variance. To accommodate these circumstances and to encourage
innovative and creative ways to address economic development problems, EDA will consider
requests for variances to the procedures set out in these Construction Standard Terms and
Conditions if they do not conflict with applicable federal statutory and regulatory requirements,
are consistent with the goals of EDA's programs. and make sound economic and financial
sense.
2
3. Definitions. Whenever used in these Construction Standard Terms and Conditions, the
following words and phrases shall have the following meanings:
a. "Assistant Secretary" refers to the Assistant Secretary of Commerce for Economic
Development:
b. "Award" - see the definition set out in the first paragraph of the Preface above;
c. "Closeout" or "Project Closeout" refers to the process by which the Grants Officer
determines that all applicable administrative actions and all required work under the A ward
has been completed by the Recipient and EDA;
d. "Department" or "DOC" refers to the U.S. Department of Commerce;
e. "Government" or "Federal Government" refers to EDA;
f. "Grants Officer" refers to the Regional Director in the appropriate Regional Office;
g. "Project Officer," refers to the EDA official responsible for technical or other
programmatic aspects of the A ward. During the post-approval stage of the A ward, EDA
generally assigns this role to an EDA Engineer/Construction Manager.
h. "Project" refers to the activity for which the EDA grant was awarded;
I. "Recipient" refers to the undersigned grantee of U.S, government funds under the Award to
which this document is made a part;
J. "Regional Office" refers to an EDA regional office;
k. "Subrecipient" or "Subgrantee" refers to the legal entity to which a subaward is made and
which is accountable to the Recipient for the use of grant funds (this term does not include
subcontractors with whom the Recipient enters into a contractual agreement); and
I. "Terms and Conditions of the Award" - see the definition set out in the first paragraph of
the Preface above.
Capitalized terms used but not otherwise defined in these Construction Standard Terms and
Conditions have the meanings ascribed to them in EDA's regulations at 13 C.F.R. SS 300.3,
302.20, 307.8, and 3] 4.1.
4. Grant Recipient as Trustee. The Recipient holds grant funds and any EDA-assisted Project
property in trust for the purpose(s) for which the Award was made. The Recipient's obligation
to the Federal Government continues for the estimated useful life of the Project, as determined
by EDA, during which EDA retains an undivided equitable reversionary interest (the "Federal
Interest") in the property improved, in whole or in part, with the EDA investment.
See J3 C.F.R. S 314.2.
IfEDA determines that the Recipient fails or has failed to meet this obligation, the agency may
exercise any rights or remedies with respect to its Federal Interest in the Project. However,
EDA 's forbearance in exercising any right or remedy in connection with the Federal Interest
does not constitute a waiver thereof.
B. Financial Requirements.
I . Financial Reports.
a. While EDA generally does not advance funds under an Award, the Recipient must submit
Form SF-272, "Report of Federal Cash Transactions," for any Award where funds are to
be advanced to the Recipient. Form SF-272 is due 15 working days following the end of
each Quarter for an Award under $1 million, 15 working days following the end of each
3
month for an Award totaling $1 million or more per year, or as otherwise specified in a
special award condition. See] 5 C.F.R. 99 14.52(a)(2) or 24.4 ](c), as applicable.
b. Any Recipient whose Award has not been fully disbursed is required to submit
Form SF-269, "Financial Status Report" to EDA semi-annually to repon on the status of
unreimbursed obligations. This repon will provide information on the amount of allowable
Project expenses that have been incurred, but not claimed for reimbursement by the
Recipient. The first repon shall be as of March 30 of each year and shall be submitted to
EDA no later than April 30 of each year, and the second repon shall be of September 30 of
each vear and shall be submitted to EDA no later than October 30 of each year.
Instructions for completing and submitting Form SF-269 will be furnished to the Recipient
at least 60 days before the repon is due.
c. The Recipient must submit a final financial repon using Form SF-269 within 90 days of the
expiration date of the Award (or from the date the Recipient accepts the Project from the
contractor, whichever occurs earlier).
d. Noncompliance with these requirements will result in the suspension of disbursements
under this A ward.
e. Financial repons are to be submitted to the Project Officer.
2. Disbursement Requests.
a. Method of Payment. The Grants Officer determines the appropriate method of payment.
Unless otherwise specified in a special award condition, the method of payment under this
Award will be reimbursement. Payments will be made through electronic funds transfers
directly to the Recipient's bank account and in accordance with the requirements of the
Debt Collection Improvement Act of 1996 (31 U.S.c. 9 3720B et seq.). The Award
number shall be included on all payment-related correspondence, information, and forms.
b. Disbursement Requests. The Recipient shall use Form SF-271, "Outlay Report and
Requestfor Reimbursementfor Construction Programs," to request reimbursement under
the Award. Substantiating invoices and/or vouchers also must be provided. Each request
for the disbursement of funds shall be made to the Project Officer. Form SF-271 can be
downloaded from OMB's website at www.whitehouse.gov/omb/grants/grantsforrns.htm!.
c. Initial Disbursement Request. For the initial disbursement only, the Recipient must
complete and submit Form SF-388 I, "ACH Vendor/Miscellaneous Payment Enrollment
Form," along with Form SF-27I, to the Project Officer.
d. Interim Disbursement Requests. All requests for interim disbursement shall be submitted
using Form SF-271 and include substantiating invoices and/or vouchers.
3. Federal and Non-Federal Cost Sharing.
a. Awards that include the federal and non-federal share incorporate an estimated budget
consisting of shared allowable costs. If actual allowable costs are less than the total
approved estimated budget, the federal share and non-federal share, or "Matching Share,"
shall be calculated by applying the approved federal and non-federal cost share ratios to
4
actual allowable costs. See also 13 C.F.R. 9S 305.10 and 308.2. If actual allowable costs
are greater than the total approved estimated budget, the federal share shall not exceed the
total federal dollar amount authorized by this Award.
b. The Matching Share, whether cash or in-kind, shall be paid out at the same rate as the
federal share. Exceptions to this requirement may be granted by the Grants Officer based
on sufficient documentation demonstrating previously determined plans for, or later
commitment of, cash or in-kind contributions. In any case, the Recipient must meet its cost
share commitment over the Award period.
c. The Recipient shall show that the Matching Share is committed to the Project, available as
needed, and not conditioned or encumbered in any way that precludes its use consistent
with the requirements of EO A investment assistance. See 13 C.F.R. S 301.5.
4. Budget Revisions and Transfers of Funds Among Budget Categories. The EOA-approved
budget is the budget plan for the Project. The Recipient must notify EOA of any deviation
from the budget or program plans, including any change in scope of work or the objective of
the Project (even if there is no associated budget revision requiring prior written approval).
See 15 C.F.R. 9S 14.25 or 24.30, as applicable.
a. Requests for budget revisions to the EOA-approved budget in accordance with the
provisions provided below must be submitted to the Grants Officer, who shall make the
final determination on such requests and notify the Recipient in writing.
b. Amendments to this Award require preparation of Form C0-451, "Amendment to Financial
Assistance Award," for execution by both the Grants Officer and the Recipient.
Form CO-451 is required for the following:
(i) Changes to the Project scope of work;
(ii) Budget revisions requiring additional EOA or non-EOA funds;
(iii) Budget revisions that result in cumulative transfer among direct cost categories in
excess of ] 0 percent of the project cost and the federal share is greater than $] 00,000;
(iv) The inclusion of costs for which EOA's prior approval is needed under the following
OMB Circulars: Circular A-2], "Cost Principles for Educational Institutions"
(2 C.F.R. part 220); Circular A-87, "Cost Principles for State. Local. and Indian
Tribal Governments" (2 C.F.R. part 225); and Circular A-122, "Cost Principlesfor
Non-Profit Organizations" (2 C.F.R. part 230). as applicable;
(v) Change of site location;
(vi) Change or addition of Recipient;
(vii) Time extensions; and
(viii) Modifications to the Terms and Conditions of the Award, other than time extensions.
c. When an Award supports both construction and non-construction work, the Recipient must
obtain prior written approval from the Grants Officer before making any fund or budget
transfer from non-construction to construction or vice versa. See] 5 C.F.R. SS 14.25Ul or
24.30(c)(3), as applicable.
d. Transfers shall not be permitted if such transfers would cause any federal appropriation, or
part thereof, to be used for purposes other than those intended. This transfer authority does
not authorize the Recipient to create new budget categories within an approved budget
5
unless the Grants Officer has provided prior written approval. In addition, this does not
prohibit the Recipient from requesting the Grants Officer's approval for revisions to the
budget. See 15 C.F.R. SS 14.25(e) and (I) or 24.30(c), as applicable.
e. The Recipient is not authorized at any time to transfer amounts budgeted for direct costs to
the indirect costs line item or vice versa, without written prior approval of the Grants
Officer.
f. Project Underrun Amounts. Underrun amounts shall be transferred to the contingencies
line item. Contingency funds are to be used to address situations resulting from unknown
conditions and changes required for the fulfillment of authorized activities under this
Award. EDA may approve the use ofunderrun funds to increase the federal share of the
Project or further improve the Project, as long as the improvements are approved by EDA
and consistent with the original purpose of the approved EDA investment.
See 13 C.F .R. s 308.1.
g. Additional EDA Funding in Case of Project Overrun Amounts. In accepting the A ward.
the Recipient agrees to fund any overrun amounts. Additional EDA assistance for an
approved Project may not be approved.
5. Indirect Costs.
a. Indirect costs are generally not applicable under this Award.
b. When indirect costs are applicable, they will not be allowable charges against the Award
unless specifically included as a line item in the EDA-approved budget. For Recipients
that are educational institutions, the term "indirect cost" has been replaced with the term
"facilities and administrative cost" under OMB Circular A-2!, "Cost Principles for
Educational Institutions" (see 2 C.F.R. part 220).
c. Excess indirect costs may not be used to offset unallowable direct costs.
d. If the Recipient has not previously established an indirect cost rate with a federal agency,
the negotiation and approval of a rate is subject to the procedures in applicable cost
principles and the following subparagraphs:
(i) State, local, and Indian Tribal Governments: Educational InstitUlions: and Non-
Profit Organizations (Non-Commercial Organizations)
For the above-listed organizations, "cognizant federal agency" is generally defined as
the agency that provides the largest dollar amount of direct federal funding. For those
organizations for which DOC is cognizant or has oversight, DOC or its designee will
either negotiate a fixed rate with carry-forward provisions for the Recipient or, in
some instances, will limit its review to evaluating the procedures described in the
Recipient's cost allocation methodology plan. Indirect cost rates and cost allocation
methodology reviews are subject to future audits to determine actual indirect costs.
(ii) Within 90 days of the Award start date, the Recipient shall submit to the address
listed below documentation (indirect cost proposal, cost allocation plan, etc.)
necessary to perform the review. The Recipient shall provide the Grants Officer with
a copy of the transmittal letter.
6
Office of Acquisition Management
U.S. Department of Commerce
14th Street and Constitution Avenue. N.W., Room # 6054
Washington, DC 20230
(iii) The Recipient can use the fixed rate proposed in the indirect cost plan until such time
as DOC provides a response to the submitted plan. Actual indirect costs must be
calculated annually and adjustments made through the carry-forward provision used
in calculating next year's rate. This calculation of actual indirect costs and the carry-
forward provision is subject to audit. Indirect cost rate proposals must be submitted
annually. An organization that has previously established indirect cost rates must
submit a new indirect cost proposal to the cognizant agency within six months after
the close of the Recipient's fiscal years.
e. When DOC is not the oversight or cognizant federal agency, the Recipient shall provide the
Grants Officer with a copy of a negotiated rate agreement or a copy of the transmittal letter
submitted to the cognizant or oversight federal agency requesting a negotiated rate
agreement.
f. If the Recipient fails to submit the required documentation to DOC within 90 days of the
A ward start date, the Grants Officer may amend the A ward to preclude the recovery of any
indirect costs under the Award. If the DOC, oversight, or cognizant federal agency
determines there good and sufficient cause to excuse the Recipient's delay in submitting
the documentation, an extension of the 90-day due date may be approved by the Grants
Officer.
g. Regardless of any approved indirect cost rate applicable to the Award, the maximum dollar
amount of allocable indirect costs for which DOC will reimburse the Recipient shall be the
lesser of:
(i) The line item amount for the federal share of indirect costs contained in the approved
budget of the A ward; or
(ii) The federal share of the total allocable indirect costs of the Award based on the
indirect cost rate approved by a cognizant or oversight federal agency and current at
the time the cost was incurred, provided the rate is approved on or before the Award
end date.
6. Incurring Costs Prior to Award. Project activities carried out prior to EDA's approval of
this Award shall be carried out at the sole risk of the Recipient. Such activity is subject to the
rejection of the application, the disallowance of costs, or other adverse consequences as a result
of noncompliance with EDA or federal law, including but not limited to procurement
requirements, civil rights requirements, federal labor standards, or environmental and historic
preservation requirements. Costs must be included in the EDA-approved budget and must be
allowable costs under federal cost principles and under the Award. See J 3 C.F.R. S 302.8.
7. Incurring Costs or Obligating Funds Beyond the Project Expiration Date.
a. The Recipient shall not incur costs or obligate funds for any purpose pertaining to the
Project, program, or activities beyond the expiration date stipulated in this A ward (or the
7
date of acceptance of the Project by the contractor, whichever occurs earlier), unless a
WJ,;ten time extension of this Award is granted by the Grants Officer. The only costs that
are authorized for a period of up to 90 days following that date are those strictly associated
with Closeout activities. Closeout activities are generally limited to the preparation of final
repons. See 15 C.F.R. 99 14.71 or 24.50, as applicable.
b. The Recipient shall adhere to the development time schedule and time limits set out in the
Terms and Conditions of this Award. Any such Term or Condition supersedes the
development time schedule and time limits set out in these Construction Standard Terms
and Conditions.
8. Time Extensions.
a. Unless otherwise authorized in 15 C.F.R. 99 14.25(e)(2) or 24.30, as applicable, or a
special award condition. any extension of the Project period can only be authorized by the
Grants Officer in writing. A verbal or written assurance of funding from other than the
Grants Officer, including Regional Office staff other than the Grants Officer, does not
constitute authority to obligate funds for programmatic activities beyond the expiration
date.
b. The Recipient is responsible for implementing the Project in accordance with the
development time schedule contained in this A ward. As soon as the Recipient becomes
aware that it will not be possible to meet the development time schedule, the Recipient
must notify the Grants Officer. The Recipient's notice to EDA must contain the following:
(i) An explanation of the Recipient's inability to complete work by the specified date
(e.g., a lengthy period of unusual weather delayed the contractor's ability to excavate
the site, major re-engineering required in order to obtain State or federal approvals,
unplanned environmental mitigation required);
(ii) A statement that no other changes to the Project are contemplated;
(iii) Documentation that demonstrates there is still a bona fide need for the Project; and
(iv) A statement that no further delay is anticipated and that the Project can be completed
within the revised time schedule.
EDA reserves the right to withhold disbursements while the Recipient is not in compliance
with the time schedule. EDA reserves the right to suspend or terminate this Award if the
Recipient fails to proceed with reasonable diligence to accomplish the Project as intended.
c. EDA has no obligation to provide any additional prospective funding. Any amendment of
this Award to increase funding or to extend the period of performance is at the sole
discretion of EDA.
9. Tax Refunds. Refunds of Federal Insurance Contributions Act and Federal Unemployment
Tax Act ("FICA/FUTA") taxes received by the Recipient during or after the Project period
must be refunded or credited to DOC where the benefits were financed with federal funds
under the Award. The Recipient agrees to contact the Grants Officer immediately upon receipt
of these refunds. The Recipient further agrees to refund ponions of FICA/FUT A taxes
determined to belong to the Federal Government, including refunds received after the
expiration of this A ward.
8
10. Program Income. For Projects that create long-term rental revenue (e.g.. buildings or real
property constructed or improved for the purpose of renting or leasing space). the Recipient
agrees to use such income generated from the rental or lease of any Project facility in the
following order of priority:
a. Administration. operation. maintenance. and repair of Project facilities for their estimated
useful life (as determined by EDA) in a manner consistent with good property management
practice and in accordance with established building codes. This includes. where
applicable. repayment of indebtedness resulting from any EDA-approvcd encumbrance
(e.g., approved mortgage) on the EDA-assisted facility.
b. Economic development activities that are authorized for support by EDA, provided such
activities meet the economic development purposes of PWEDA.
See 15 C.F.R. SS 14.24 or 24.25. as applicable.
C. Programmatic Requirements.
I. Quarterly Reporting.
a. Quarterly performance reports must be submitted in accordance with the procedures set out
in 15 C.F.R. parts]4 or 24, as applicable, and as indicated below. Failure to submit
required reports in a timely manner may result in the withholding of payments under this
A ward; deferral of processing of new awards, amendments, or supplemental funding
pending the receipt of the overdue report(s); or the establishment of an account receivable
for the difference between the total federal share of outlays last reported and the amount
disbursed. See 13 C.F.R. S 302.18(a).
b. Unless otherwise specified in this A ward, the quarterly performance report will contain the
following information for each Project program, function, or activity:
(i) A comparison of planned and actual accomplishments according to the timetable or
list of Project objectives in this Award;
(ii) An explanation of any delays or failures to meet the Project timetable or Project
goals; and
(iii) Any other pertinent information including, when appropriate. analysis, and
explanation of cost overruns or high unit costs.
c. Quarterly performance reports shall be submitted for each calendar quarter to the Project
Officer. Each performance report will be due not later than January 15, April 15, July 15,
and October 15 for the immediate previous quarter. The final Project performance report
shall be submitted to EDA no more than 90 days after the Project Closeout date. This
reporting requirement begins with the Recipient's acceptance of this Award and ends when
EDA approves Project Closeout. See 15 C.F.R. SS 14.5 I or 24.40, as applicable.
The Recipient shall submit quarterly performance reports to the EDA Project Officer in
hardcopy or electronically as specified in the special award conditions.
2. Interim Reporting. The Recipient must report any event that will or may have significant
impact upon the Project, including delays or adverse conditions that materially may affect the
9
ability of the Recipient to anain Project objectives within established time periods or meet the
development time schedule. The Recipient should report such events to the Project Officer in
the most time-expedient way possible and then, if the initial report was not in writing, report
the event to the Project Officer in writing. Such a report shall include a statement of the event
or issue. a statement of the course of action contemplated to resolve the matter, and any federal
assistance needed to resolve the situation. If budget changes are required, the Recipient must
submit a wrinen budget revision request. See 15 C.F.R.1j1j 14.25(h) or 24.30(c)(2). as
applicable.
3. Government Performance and Results Act Reporting. In addition to quarterly performance
reports, EDA may require the Recipient to report on Project performance beyond the Project
Closeout date for Government Performance and Results Act (GPRA) purposes. In no case
shall the Recipient be required to submit any report more than ten years after the Project
Closeout date. Data used by the Recipient in preparing reports shall be accurate and from
independent sources whenever possible. See 13 C.F.R. Ij 302.16.
4. Unsatisfactory Performance. Failure to perform the work in accordance with the Terms and
Conditions of the Award and maintain at least satisfactory performance at the discretion of
EDA may result in the designation of the Recipient as high-risk and assignment of special
award conditions or further action as specified in section C. 7. of these Construction Standard
Terms and Conditions. See 15 C.F.R.1j1j 14.14 or 24.12, as applicable.
5. Programmatic Changes.
a. The Recipient must report to the Grants Officer, and request prior approval for any
programmatic change to the Award, in accordance with 15 C.F.R. Ijlj 14.25 or 24.30, as
applicable.
b. The Recipient must obtain the Grants Officer's written approval for any programmatic
changes to the Award. Any changes made to the Project without EDA's approval are made
at the Recipient's risk of nonpayment of costs, suspension, termination, or other EDA
action with respect to the Award. See 13 C.F.R.1j 302.7(b).
c. Contract Change Orders. After construction contracts for the Project have been executed,
it may become necessary to alter them. This requires a formal contract change order that
must be issued by the Recipient and accepted by the contractor. All contract change orders
must be reviewed by EDA, even if EDA is not participating in the cost of the change order
or the contract price is to be reduced. Work on the Project may continue pending EDA
review and approval of the change order, but all such work shall be at the Recipient's risk
as to whether the cost of the work is eligible for EDA participation until the Recipient
receives EDA approval for the change order. See 13 C.F.R. Ij 305.13.
6. Other Federal Awards with Similar Programmatic Activities. The Recipient shall
immediately provide written notification to the Project Officer and the Grants Officer in the
event that. subsequent to receipt of this Award, other financial assistance is received to support
or fund any portion of the scope of work incorporated into this Award. EDA will not pay for
costs that are funded by other sources.
7. Noncompliance with Award Provisions. Failure to comply with any or all of the Terms and
Conditions of this Award may have a negative impact on the Recipient's ability to receive
10
future funding from the Depanment, including EDA, and may be considered grounds for any
or all of the following actions: (a) the establishment of an account receivable: (b) withholding
payments under any EDA or DOC Award(s) to the Recipient: (c) the imposition of additional
special award conditions; (d) the suspension of any active DOC Awards: or (e) the termination
of any active DOC A wards.
The Recipient hereby agrees that the Government may at its option withhold disbursement of
any Award funds if the Government learns or has knowledge that the Recipient has failed to
comply in any manner with any Term or Condition of the Award. See 13 C.F.R. !i 302.18.
The Government may withhold funds until the violation or violations have been corrected to
the Government's satisfaction. The Recipient further agrees to reimburse the Government for
any ineligible costs paid from Award funds, or if the Recipient fails to reimburse the
Government, the Government shall have the right to offset the amount of such ineligible costs
from any undisbursed award funds held by the Government. The Recipient agrees to repay the
Government for all ineligible costs incurred in connection with the Project and paid from the
Award including but not limited to those costs determined to be ineligible if the Government
learns of any Award violations after all Award funds have been disbursed.
See 15 C.F.R.!i!i 14.72-14.73 or 24.51-24.52, as applicable.
8. Use by Beneficiary. In the event a beneficiary of the Project fails to comply in any manner
with cenifications, assurances, or agreements that such beneficiary has entered into in
accordance with EDA's requirements, the Recipient will reimburse the Government the Award
amount or an amount to be deterrnined by the Government pursuant to 13 C.F.R. !is 3 I 4.4 and
314.5. Where the Government deterrnines that the failure of a beneficiary to comply with EDA
requirements affects a portion of the propeny benefited by the A ward, the Rec ipient will
reimburse the Government proportionately.
9. Prohibition Against Assignment by the Recipient. Except as provided in a special award
condition, the Recipient shall not transfer, pledge, mortgage, or otherwise assign the A ward, or
any interest therein, or any claim arising thereunder, to any party or panies, banks, trust
companies, or other financing or financial institutions.
10. Disclaimer Provisions; Hold Harmless Requirement.
a. The United States expressly disclaims any and all responsibility or liability to the Recipient
or third persons for the actions of the Recipient or third persons resulting in death, bodily
injury, property damages, or any other losses resulting in any way from the performance of
this Award or any subaward or subcontract under this Award.
b. The acceptance of this A ward by the Recipient does not in any way constitute an agency
relationship between the United States and the Recipient.
c. To the extent permitted by law, the Recipient agrees to indemnify and hold the Government
harmless from and against all liabilities that the Government may incur as a result of
providing an Award to assist, directly or indirectly, in the preparation of the Project site or
construction, renovation, or repair of any facility on the Project site, to the extent that such
liabilities are incurred because of toxic or hazardous contamination or groundwater, surface
water, soil, or other conditions caused by operations of the Recipient or any of its
predecessors (other than the Government or its agents) on the property.
See 13 C.F.R. S 302.19.
II
II. Prohibition on Use of Third Parties to Secure Award. Unless otherwise specified in the
special award conditions to this Award. the Recipient warrants that no person or selling agency
has been employed or retained to solicit or secure this A ward upon an agreement or
understanding for a commission, percentage, brokerage, or contingent fee, excepting bona fide
employees. or bona fide established commercial or selling agencies maintained by the
Recipient for the purpose of securing business. For breach or violation of this warrant, the
Government has the right to annul this Award without liability. or at its discretion. to deduct
from the A ward sum, or otherwise recover, the full amount of such commission, percentage,
brokerage, or contingent fee.
12. Payment of Attorneys' or Consultants' Fees. No A ward funds shall be used. directly or
indirectly, to reimburse attorneys' or consultants' fees incurred in connection with obtaining
investment assistance under PWEDA, such as, for example, preparing the application for EDA
investment assistance. However, ordinary and reasonable attorneys' and consultants' fees
incurred for meeting A ward requirements, such as, for example, conducting a title search or
preparing plans and specifications, may be eligible Project costs and may be paid out of Award
funds, provided such costs are otherwise eligible. See 13 e.F.R. S 302.10.
13. Commencement of Construction.
a. Delayed Construction Starts. If significant construction (as determined by EDA) is not
commenced within two years of the Award date or by the date estimated for start of
construction in this Award (or the expiration of any extension granted in writing by EDA),
whichever is later, this Award will be automatically suspended and may be terminated if
EDA determines, after consultation with the Recipient, that construction to completion
cannot reasonably be expected to proceed promptly and expeditiously. If significant
construction has not been commenced within three years of the A ward date, an extension
must be approved by the Assistant Secretary.
b. Early Construction Starts. The Recipient shall make a written request to EDA for early
construction start permission (that is, after the date of Award, but before EDA gives formal
approval for construction to commence). For Project costs to be eligible for EDA
reimbursement, EDA must determine that the award of all contracts necessary for design
and construction of the Project facilities is in compliance with the Terms and Conditions of
this Award. If construction commences prior to EDA's determination, the Recipient
proceeds at its own risk until EDA's review and concurrence. See 13 e.F.R. 9 305. I I.
c. Project Sign. The Recipient is responsible for constructing, erecting, and maintaining in
good condition throughout the construction period a sign (or signs) in a conspicuous place
at the Project site indicating that the Federal Government is participating in the Project.
EDA will provide specifications for the sign and may require more than one sign if site
conditions so warrant. If the EDA-recommended sign specifications conflict with State or
local law, the Recipient may modify such recommended specifications so as to comply
with State or local law. See 13 e.FR. S 305. I 2.
14. Efficient Administration of Project. The Recipient agrees to properly and efficiently
administer, operate, and maintain the Project for its estimated useful life, as required by
section 504 ofPWEDA (42 U.s.e. S 3194). If the Government determines. at any time during
the estimated useful life of the facility, that the Project is not being properly and efficiently
12
administered. operated, and maintained, the Government may terminate this A ward and require
the Recipient to repay the Federal Share. See 13 C.F.R. 99 302.12, 302.18. and 314.2-314.5.
15. Conflicts-of-Interest Rules.
a. An "Interested Party" is defined in 13 C.F.R. 9 300.3 as "any officer, employee, or member
of the board of directors or other governing board of the Recipient, including any other
parties that advise, approve, recommend, or otherwise participate in the business decisions
of the Recipient, such as agents, advisors, consultants, attorneys, accountants, or
shareholders." An Interested Party includes the Interested Party's "Immediate Family"
(defined in 13 C.F.R. 9 300.3 as a person's spouse, parents, grandparents, siblings,
children, and grandchildren, but does not include distant relatives, such as cousins, unless
the distant relative lives in the same household as the person) and other persons directly
connected to the Interested Party by law or through a business organization. In addition,
"Immediate Family" includes an Interested Party's "significant other" or partner.
b. The Recipient must establish safeguards to prohibit an Interested Party from using its
position for a purpose that constitutes or presents the appearance of personal or
organizational conflicts-of-interest or of personal gain. See 13 C.F.R. 9 302.17(a) and (b),
15 C.F.R. 9914.42 or 24.36(b)(3), as applicable, and Fonns SF-424B ("Assurances-
Non-Construction Projects") and SF-424D ("Assurances - Construction Projects").
c. An Interested Party must not receive any direct or indirect financial or personal benefits in
connection with this Award or its use for payment or reimbursement of costs by or to the
Recipient. A financial interest may include employment, stock ownership, a creditor or
debtor relationship, or prospective employment with the organization selected or to be
selected for a subaward. An appearance of impainnent of objectivity could result from an
organizational conflict where, because of other activities or relationships with other persons
or entities, a person is unable or potentially unable to render impartial assistance or advice.
It also could result from non-financial gain to the individual, such as benefit to reputation
or prestige in a professional field. See] 3 C.F.R. 9302.17(b).
16. Record-Keeping Requirements.
a. Records. The Recipient must maintain records that document compliance with the Tenns
and Conditions of this Award. At a minimum, the Recipient's records must fully disclose:
(i) The amount and disposition of ED A investment assistance;
(ii) All Project expenditures and procurement actions;
(iii) The total cost of the Project that the Award funds;
(iv) The amount and nature of the portion of Project costs provided by non- EDA sources;
(v) Contractor compliance with applicable federal requirements; and
(vi) Such other records as EDA determines will facilitate an effective audit.
b. Records Retention.
In general, all records pertinent to this Award must be kept retained for a period of three
years from the date of submission of the final project expenditure report (the final
Fonn SF-271 for disbursement). The only exceptions are the following:
13
(i)
Ifany litigation. claim. or audit is started before the expiration of the three-year
period, the records shall be retained until all litigation. claims, or audit findings
involving the records have been resolved and final actions taken.
Records for real property and equipment acquired with federal funds must be retained
for three years after final disposition.
When records are transferred or maintained by EDA, the three-year retention
requirement is not applicable to the Recipient.
(ii)
(iii)
Records relating to indirect cost rate computations or proposals, cost allocation plans, and
any similar accounting computations on the rate at which a particular group of costs is
chargeable are subject to different retention requirements. See 15 C.F .R. 99 14.53 or 24.42,
as applicable.
The Recipient is responsible for monitoring any subrecipients and contractors to ensure
their compliance with the records retention requirements. The Recipient must immediately
notify the Project Officer in case records are not retained for the general retention periods
noted above. See 13 C.F.R. 9302.14 and] 5 C.F.R. 99 14.50-14.53 or 99 24.40-24.42,
as applicable.
17. Termination Actions.
a. Terminationfor Cause. If the Recipient materially fails to comply with any of the Terms
and Conditions of this Award, EDA has the right to terminate for cause all or any part of its
obligation hereunder, including if:
(i) Any representation made by the Recipient to the Government in connection with the
application for Government assistance is incorrect or incomplete in any material
respect;
(ii) The intent and purpose and/or the economic feasibility of the Project is changed
substantially so as to affect significantly the accomplishment of the Project as
intended (including an unauthorized use of property as provided in ]3 C.F.R 9 314.4);
(iii) The Recipient has violated commitments it made in its application and supporting
documents or has violated any of the Terms and Conditions of this Award;
(iv) The conflicts-of-interest rules in 13 C.F.R. 9 302.17 are violated; or
(v) The Recipient fails to report immediately to the Government any change of
authorized representative(s) acting in lieu of or on behalf of the Recipient.
In addition, EDA may take one or more of the actions set out in 15 C.F.R. 99 ]4.62(a) or
24.43(a), as applicable.
b. Terminationfor Convenience. The Recipient may request at any time termination for
convenience of this Award upon sending to the Grants Officer written notification in a
form acceptable to EDA setting forth the reasons for requesting the termination and the
effective date of such termination. See] 5 C.F.R. 99 14.61 or 24.44. as applicable.
18. Project Closeout Procedures. After construction is completed and the Project is closed out
financially, the Recipient has an ongoing responsibility to properly administer. operate. and
maintain the Project for its estimated useful life (as determined by EDA) in accordance with its
original purpose. See J3 C.F.R. 9 302.12. The Recipient must comply with all Award
14
requirements and maintain records to document such compliance, which shall be made
available for inspection by EDA or other Government officials as required.
a. Final Disbursement. When Project construction and final inspection have been completed.
or substantially completed as determined by EDA, and the Recipient has accepted the
Project from the contractor, the Recipient can begin the Closeout process by submitting the
following documentation to EDA:
(i) A request for final disbursement on an executed Form SF-27I;
(ii) A written certification that all costs claimed are for eligible activities under this
Award, for which there is documentation in the Recipient's records;
(iii) An executed certificate of final acceptance signed by the Recipient and the
Recipient's architect/engineer;
(iv) The Recipient's certification that its currently valid single or program-specific audit
in accordance with OMB Circular A-133, "Audits a/States, Local Governments, and
Non-Profit Organizations," if applicable, does not contain any material findings (if
the Recipient's currently valid OMB Circular A-133 audit does contain material
findings, the Recipient shall submit the applicable audit in hardcopy to the Grants
Officer);
(v) The Recipient's certification that its currently valid audit (in accordance with OMB
Circular A-133), if applicable, has been submitted to the Federal Audit
Clearinghouse; and
(vi) Other documentation as may be required by EDA.
EDA shall advise the Recipient of costs determined to be eligible and ineligible. If a
balance of this Award is due to the Recipient, the balance will be paid by wire transfer. If
the Recipient has received an amount in excess of the amount due the Recipient, the
Recipient must refund the excess to EDA. The Recipient shall contact the Project Officer
for refund instructions.
As noted above, if the Recipient's currently valid OMS Circular A-133 audit contains
material findings, the Recipient shall submit the audit in hardcopy to the Grants Officer
before final disbursement.
b, The Recipient shall submit, within 90 calendar days after the Project Closeout date, all
financial, performance, and other reports as required by the Terms and Conditions of this
Award. Additional GPRA reporting requirements also may apply.
c. Unless EDA authorizes an extension, the Recipient shall liquidate all obligations incurred
under this A ward no later than 90 calendar days after acceptance of the Project from the
contractor or before the expiration date of this A ward, whichever occurs earlier.
d, The Closeout of this Award does not affect any of the following:
(i) Audit requirements per OMS Circular A-133 and the related "Compliance
Supplement;"
(ii) The right of EDA to disallow costs and recover funds on the basis of a later audit or
other Project review;
(iii) The Recipient's obligation to return any funds due as a result of later corrections or
other transactions; and
15
(iv) Requirements for property management. records retention, and performance
measurement reports.
D. Additional Requirements Relating to Construction Projects.
The Recipient and any subrecipient(s) must, in addition to other statuto!)' and regulato!)'
requirements detailed in these Construction Standard Terms and Conditions and the assurances made
to EDA in connection with the Award, comply and require each of its contractors and subcontractors
employed in the completion of the Project to comply with all applicable federal, State, territorial, and
local laws, and in particular. the following federal public laws (and the regulations issued
thereunder), Executive Orders, OMB Circulars, and local law requirements.
I. The Davis-Bacon Act, as amended (40 U.S.c. ~~ 3141-3144, 3146, 3147; 42 U.S.c. ~ 3212)
Requiring minimum wages for mechanics and laborers employed on Federal Government
public works projects to be based on the wages the Secretary of Labor determines to be
prevailing for the corresponding classes of laborers and mechanics employed on projects of a
character similar to the contract work in the civil subdivision of the State in which the Project
is to be performed, or in the District of Columbia if the Project is to be performed there.
2. The Contract Work Hours and Safety Standards Act, as amended
(40 U.S.c. ~~ 3701 - 3708)
Providing work hour standards for every laborer and mechanic employed by any contractor or
subcontractor in the performance of a federal public works project.
3. The National Historic Preservation Act of 1966, as amended (16 U.S.c. ~ 470 et seq.), and
the Advisory Council on Historic Preservation Guidelines
Requiring projects involving federal funds to follow the requirements of the National Historic
Preservation Act, which requires stewardship of historic properties.
4. The Historical and Archeological Data Preservation Act of 1974, as amended
(16 U.S,c. ~ 469a-1 et seq.)
Requiring appropriate surveys and preservation efforts if a federally-licensed project may
cause irreparable loss or destruction of significant scientific, prehistorical, historical, or
archeological data.
5. Architectural Barriers Act of 1968, as amended (42 U.S.c. ~ 4151 et seq.), and the
regulations issued thereunder, which prescribe standards for the design and construction of any
building or facility intended to be accessible to the public or that may house handicapped
employees.
6. The Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970,
as amended (42 U.S.c. ~ 4601 et seq.), and implementing regulations issued at 49 C.F,R.
part 24, which establish uniform policies for the fair and equitable treatment of persons,
businesses, or farm operations affected by the acquisition, rehabilitation, or demolition of real
property acquired for a Project financed wholly or in part with federal financial assistance.
7. The Energy Conservation and Production Act (42 U.S.c. ~ 6834 et seq.)
Establishing energy efficiency performance standards for the construction of new residential
and commercial structures undertaken with federal financial assistance.
16
8. Requirements for New Construction. For new building construction projects. the Recipient
will comply with current local building codes. standards. and other requirements applicable to
the Project.
E. Non-Discrimination Requirements. No person in the United States shall, on the ground of race,
color, national origin. handicap, age, religion, or sex, be excluded from participation in, be denied
the benefits of, or be subject to discrimination under any program or activity receiving federal
financial assistance. The Recipient agrees to comply with the following non-discrimination
requirements.
1. Statutory Provisions.
a. Title VI of the Civil Rights Act of 1964 (42 USe. 9 2000d et seq.) and DOC
implementing regulations published at 15 e.F.R. part 8, which prohibit discrimination on
the grounds of race, color, or national origin under programs or activities receiving federal
financial assistance;
b. Title IX of the Education Amendments of 1972 (20 U.S.C. 9 1681 et seq.), which prohibits
discrimination on the basis of sex under federally-assisted education programs or activities;
c. Pub. L. No. 92-65,42 U.S.e. 93123, which proscribes discrimination on the basis of sex in
EDA assistance provided under PWEDA; Pub. L. No. 94-369,42 U.S.e. 96709, which
proscribes discrimination on the basis of sex under the Local Public Works Program; and
the Department's implementing regulations at 15 e.F.R. 99 8.7-8.15;
d. Section 504 of the Rehabilitation Act of 1973, as amended (29 U.S.e. 9 794), and DOC
implementing regulations published at] 5 C.F.R. part 8b, which prohibit discrimination on
the basis of handicap under any program or activity receiving or benefiting from federal
assistance;
e. The Age Discrimination Act of 1975, as amended (42 use. 9 6101 et seq.) and DOC
implementing regulations published at 15 e.F.R. part 20, which prohibit discrimination on
the basis of age in programs or activities receiving federal financial assistance;
f. The Americans with Disabilities Act of 1990 (42 use. 9 12101 et seq.), which prohibits
discrimination on the basis of disability under programs, activities, and services provided
or made available by State and local governments or instrumentalities or agencies thereto,
as well as public or private entities that provide public transportation; and
g. Other applicable federal statutes, regulations, and Executive Orders.
2. Other Provisions.
a. Parts II and III of Executive Order 11246 (30 Fed. Reg. 12319, 1965). as amended by
Executive Order 11375 (32 Fed. Reg. 14303, 1967) and 12086 (43 Fed. Reg. 46501,1978),
requiring federally-assisted construction contracts to include the nondiscrimination
provisions of 99202 and 203 of that Executive Order and Department of Labor regulations
implementing Executive Order. 11246 (41 e.F.R. 9 60-1.4(b). ] 99]).
17
b. Executive Order 13166 (August 11.2000), "Improving Access to Services Jar Persons JVlIh
Limited English Proficiency." and DOC policy guidance issued on March 24, 2003
(68 Fed. Reg. 14180) to federal financial assistance Recipients on the Title VI prohibition
against national origin discrimination affecting Limited English Proficient ("LEP")
persons.
3. Title VII Exemption for Religious Organizations.
Generally, Title VII of the Civil Rights Act of 1964 (42 USe. 9 2000e et seq.), provides that
it shall be an unlawful employment practice for an employer to discharge any individual or
otherwise discriminate against an individual with respect to compensation, terms, conditions,
or privileges of employment because of such individual's race, color, religion, sex, or national
origin. However, Title VII, 42 U.S.e. 9 2000e-l(a), expressly exempts from the prohibition
against discrimination on the basis of religion, a religious corporation, association, educational
institution, or society with respect to the employment of individuals of a particular religion to
perform work connected with the carrying on by such corporation, association, educational
institution, or society of its activities.
F. Audits.
Under the Inspector General Act of 1978, as amended (5 USe. App. 3, 9 I et seq.), an audit of the
Award may be conducted at any time. The Department's Inspector General ("OIG"), or any of his
or her duly authorized representatives, shall have access to any pertinent books, documents, papers,
and records of the Recipient, whether written, printed, recorded, produced, or reproduced by any
electronic, mechanical, magnetic, or other process or medium, in order to make audits, inspections,
excerpts, transcripts, or other examinations as authorized by law. When the OIG requires a program
audit on a DOC Award, the OIG will usually make the arrangements to audit the Award, whether the
audit is performed by OlG personnel, an independent accountant under contract with DOC, or any
other federal, State, or local audit entity.
I. Requirement to Have an OMB Circular A-l33 Audit Performed; Organization-Wide,
Program-Specific, and Project Audits.
a. Organization-wide or program-specific audits shall be performed in accordance with the
Single Audit Act Amendments of 1996, as implemented by OMS Circular A-133, "Audits
of States. Local Governments, and Non-Profit Organizations," and the related "Compliance
Supplement." Recipients that expend federal awards of $500,000 or more in a fiscal year
shall have an audit conducted for that year in accordance with the requirements contained
in OMB Circular A-133. A copy of the audit shall be submitted to the Bureau of the
Census, which has been designated by OMB as a central clearinghouse. The address is:
Federal Audit Clearinghouse
1201 E. 10th Street
Jeffersonville, IN 47132
b. In accordance with 15 e.F.R. 914.26 (c) and (d), for-profit hospitals, commercial, and
other organizations not covered by the audit provisions of OMB Circular A-133 that
expend federal awards of $500,000 or more in a fiscal year, are required to have a program-
specific audit performed at the conclusion of the Project, but no less than once every five
years. Some DOC programs have specific audit guidelines that will be incorporated into
18
the A ward. ]f DOC does not have a program-specific audit guide available for the
program. the auditor should follow Generally Accepted Government Auditing Standards
and the requirements for a program-specific audit as described in OMB Circular A-133
S _.235. A copy of the program-specific audit shall be submitted to the OIG at the
following address with a copy of the transmittal letter to the Grants Officer:
Office of Inspector General
U.S. Department of Commerce
Atlanta Regional Office of Audits
401 West Peachtree Street, N.W.. Suite 2742
Atlanta. GA 30308
2. Requirement to Submit Audit to EDA. Jfthe Recipient's currently valid audit required
under OMB Circular A-] 33 contains materials findings, the Recipient must submit the audit in
hardcopy to the Grants Officer. See also section C]8.a. of these Construction Standard Terms
and Conditions.
3. Audit Resolution Process.
a. An audit of the Award may result in the disallowance of costs incurred by the Recipient
and the establishment of a debt (account receivable) due to EDA. For this reason, the
Recipient should take seriously its responsibility to respond to all audit findings and
recommendations with adequate explanations and supporting evidence whenever audit
results are disputed.
b. In accordance with the Federal Register notice dated January 27, 1989
(54 Fed. Reg. 4053), a Recipient whose Award is audited has the following opportunities to
dispute the proposed disallowance of costs and the establishment of a debt:
(i) Unless the OIG determines otherwise, the Recipient has 30 days from the date of the
transmittal of the "Draft Audit Report" to submit written comments and documentary
evidence.
(ii) The Recipient has 30 days from the date of the transmittal of the "Final Audit Report"
to submit written comments and documentary evidence. There shall be no extension
of this deadline.
(iii) EDA shall review the documentary evidence submitted by the Recipient and shall
notify the Recipient of the results in an "Audit Resolution Deterrnination Letter."
The Recipient has 30 days from the date of receipt of the Audit Resolution
Determination Letter to submit a written appeal. There shall be no extension of this
deadline. The appeal is the last opportunity for the Recipient to submit written
comments and documentary evidence that dispute the validity of the Audit Resolution
Determination Letter.
(iv) An appeal of the Audit Resolution Determination Letter does not prevent the
establishment of the audit-related debt nor does it prevent the accrual of interest on
such debt. If the Audit Resolution Determination Letter is overruled or modified on
appeal, appropriate corrective action will be taken retroactively. An appeal will stay
the offset of funds owed by the auditee against funds due to the auditee.
EDA shall review the Recipient's appeal and notify the Recipient of the results in an
Appeal Determination Letter. After the opportunity to appeal has expired or after the
]9
Apnea I Detenn ination Letter has been rendered, EDA wi II not accept any further
documentary evidence from the Recipient. No other administrative appeals are available in
the Department.
G. Debts.
I. Payment of Debts Owed the Federal Government.
Any debt detennined to be owed to the Federal Government must be paid promptly by the
Recipient. In accordance with 15 e.F.R. S 21.4, a debt will be considered delinquent if it is not
paid within 15 days of the established due date or, if there is no due date, within 30 days of the
billing date. Failure to pay a debt by the due date or, if there is no due date, within 30 days of
the billing date, shall result in the imposition of late payment charges as noted below. In
addition, failure to pay the debt or establish a repayment agreement by the due date or, if there
is no due date, within 30 days of the billing date, will also result in the referral of the debt for
collection action, including referral to the Treasury Offset Program (31 e.F.R. S 285.5) and
may result in EDA taking further action as specified in section e.7. of these Construction
Standard Terms and Conditions. The Recipient also may be suspended or debarred from
further federal financial and non-financial assistance and benefits, as provided in 2 e.F.R.
part] 326, "Nonprocurement Debarment and Suspension" until the debt has been paid in full or
until a repayment agreement has been approved and payments are made in accordance with the
repayment agreement. Payment of a debt may not come from other federally-sponsored
programs. Verification that other federal funds have not been used will be made during future
program visits and audits.
2. Late Payment Charges.
a. An interest charge shall be assessed on the delinquent debt as established by the Debt
Collection Act of 1982, as amended (31 USe. 9 3701 et seq.). The minimum annual
interest rate to be assessed is the U.S. Department of the Treasury's "Current Value of
Funds Rate" ("CVFR"). See www.fms.treas.gov/cvfr/index.html. The U.S. Department of
Treasury annually publishes the CVFR in the Federal Register. The assessed rate shall
remain fixed for the duration of the indebtedness.
b. A penalty charge will be assessed on any portion ofa debt that is delinquent for more than
90 days, although the charge will accrue and be assessed from the date the debt became
delinquent.
c. An administrative charge will be assessed to cover processing and handling the amount
due.
3. Barring Delinquent Federal Debtors from Obtaining Federal Loans or Loan Insurance
Guarantees.
Pursuant to 31 U.S.e. S 3720B. unless waived, the Department is not permitted to extend
financial assistance in the fonn of a loan. loan guaranty, or loan insurance to any person
delinquent on a non-tax debt owed to a federal agency. This prohibition does not apply to
disaster loans.
20
4. Effect of Judgment Lien on Eligibility for Federal Grants, Loans, or Programs.
Pursuant to 28 Us.e. S 320 I (e). unless waived by DOe. a debtor who has a judgment lien
against the debtor's property for a debt to the United States shall not be eligible to receive any
grant or loan that is made, insured, guaranteed, or financed directly or indirectly by the U.S. or
to receive funds directly from the Federal Government in any program, except funds to which
the debtor is entitled as beneficiary, until the judgment is paid in full or otherwise satisfied.
H. Name Check Re\'iews.
I. Name Check Requirement. A name check review will be performed by the OIG on key
individuals associated with nonprofit organization applicants, unless: (a) the proposed award
amount is $100,000 or less; (b) the applicant has been a Recipient of financial assistance from
the Department for three or more consecutive years without any adverse programmatic or audit
finding; or (c) the applicant is a unit ofa State or local government. See "Department of
Commerce Pre-Award Notification Requirementsfor Grants and Cooperative Agreements"
(69 Fed. Reg. 78389, December 30. 2004).
2. Exemptions. The following individuals who are acting on behalf of their respective entities in
applying for assistance are exempt from the name check review process:
a. Officials of State and local governments;
b. Officials of accredited colleges and universities; and
c. Officials of economic develupment districts designated by EDA, including those entities
whose designations are pending.
3. Results of Name Checks. EDA reserves the right to take any of the actions described in
section H.4. below if any of the following occurs as a result of the name check review:
a. A key individual fails to submit the required Form CD-346, "Applicant for Funding
Assistance;"
b. A key individual makes an incorrect statement or omits a material fact on Form CD-346; or
c. The name check reveals significant adverse findings that reflect on the business integrity or
responsibility of the applicant and/or key individual.
4. Action(s) Taken as a Result of Name Check Re\'iew. Ifany situation listed in section H.3.
above occurs, the Department, at its discretion, may take one or more of the following actions:
a. Consider suspension or termination of the Award;
b. Require the removal of any key individual from association with the management or
implementation of the Award; or
c. Make appropriate provisions or revisions as needed (in the special award conditions to the
Award) with respect to the method of payment and/or financial reporting requirements.
21
I. Governmentwide Debarment and Suspension (:\on-procurement). The Recipient shall comply
with the provisions of subpart C of 2 e.F.R. part 1326, ''Non-Procurement Debarment and
Suspension," which generally prohibit entities that have been debarred, suspended, or voluntarily
excluded from participating in federal non-procurement transactions either through primary or
lower-tier covered transactions.
J. Drug-free Workplace. The Recipient shall comply with the provisions of the Drug-Free Workplace
Act of 1988 (4] USe. !i 702), and the Department's implementing regulations found at
15 e.F.R. part 29, "Government-wide Requirements for Drug-Free Workplace (Financial
Assistance,j" which require that the Recipient take steps to provide a drug-free workplace.
K. Lobbying Restrictions.
I. Statutory Provisions. The Recipient must comply with the provisions of 31 USe. !i 1352
and the Department's implementing regulations published at 15 e.F.R. part 28,
"New Restrictions on Lobbying." These provisions generally prohibit the use offederal funds
for lobbying the executive or legislative branches of the United States government in
connection with the Award and require the disclosure of the use of non-federal funds for
lobbying.
2. Disclosure of Lobbying Activities. A Recipient receiving in excess of $1 00,000 in federal
funding must submit a completed Fonn SF-LLL, "Disclosure of Lobbying Activities,"
regarding the use of non-federal funds for lobbying. The Form SF-LLL must be submitted
within 30 days following the end of the calendar quarter in which there occurs any event that
requires disclosure or that materially affects the accuracy of the infonnation contained in any
disclosure fonn previously filed. The Recipient must submit Fonn SF-LLL from all applicable
parties, including those received from subrecipients, contractors, and subcontractors, to the
Grants Officer.
3. Special Provisions Relating to Indian Tribes. As set out in 31 U.S.e. !i 1352, there are
special provisions applicable to Indian Tribes, tribal organizations, or other Indian
organizations eligible to receive federal contracts, grants, loans, or cooperative agreements. In
accordance with Departmental policy, EDA recognizes Tribal Employment Rights Ordinances
('TEROs"), which may provide for preferences in contracting and employment, in connection
with its financial assistance awards. Tribal ordinances requiring preference in contracting,
hiring, firing, and the payment of a TERO fee generally are allowable provisions under federal
awards granted to American Indian and Alaska Native tribal governments. The payment of the
TERO fee, which supports the tribal employment rights office to administer the preferences,
should generally be allowable as an expense that is "necessary and reasonable for proper and
efficient perfonnance and administration" of an Award, as provided under the applicable cost
principles set out in 2 e.F.R. part 225.
L. Codes of Conduct and Subaward, Contract, and Subcontract Provisions.
I. Code of Conduct for Recipients. Pursuant to the certification in Fonn SF-424B, paragraph 3,
the Recipient must maintain written standards of conduct to establish safeguards to prohibit
employees from using their positions for a purpose that constitutes or presents the appearance
of personal or organizational conflicts-of-interest or personal gain in the administration of this
Award.
22
I
I
~
Applicability of A ward Provisions to Subrecipients.
a. The Recipient shall require all subrecipients. including lower tier subrecipients. under the
award to comply with the provisions of this Award, including applicable cost principles.
administrative. and audit requirements.
b. A Recipient is responsible for subrecipient monitoring. including the following:
(i) Award Identification - At the time of the Award. identifying to the subrecipient the
federal award information (e.g.. Catalog of Federal Domestic Assistance ("CFDA")
title and number, name of the federal agency, and the Award number) and applicable
compliance requirements.
(ii) During-the-Award Monitoring- Monitoring the subrecipient's use offederal awards
through reporting. site visits, regular contact, or other means to provide reasonable
assurance that the subrecipient administers federal awards in compliance with laws,
regulations, and the provisions of contracts or grant agreements and that performance
goals are achieved.
(iii) Subrecipient Audits - Ensuring that a subrecipient expending federal awards of
$500,000 or more during the subrecipient's fiscal year has met the audit requirements
of OMS Circular A-133 and that the required audits are completed within nine
months of the end of the subrecipient's audit period. In addition, the Recipient is
required to issue a management decision on audit findings within six months after
receipt of the subrecipient's audit report and ensure that the subrecipient takes timely
and appropriate corrective action on all audit findings. In cases ofa subrecipient's
continued inability or unwillingness to have the required audits, the pass-through
entity shall take appropriate action using sanctions.
3. Competition and Codes of Conduct for Subawards.
a. All subawards will be made in a manner to provide, to the maximum extent practicable,
open and free competition. The Recipient must be alert to organizational contlicts of
interest as well as other practices among subrecipients that may restrict or eliminate
competition. In order to ensure objective subrecipient performance and el iminate unfair
competitive advantage, subrecipients that develop or draft work requirements, statements
of work, or requests for proposals shall be excluded from competing for such subawards.
b. The Recipient shall maintain written standards of conduct governing the performance of its
employees engaged in the Award and administration of subawards. No employee, officer,
or agent shall participate in the selection, award, or administration of a subaward supported
by federal funds if a real or apparent contlict-of-interest would be involved. Such a
conflict would arise when the employee, officer, or agent. any member of his or her
immediate family, his or her partner, or an organization in which he/she serves as an officer
or which employs or is about to employ any of the parties mentioned in this section, has a
financial interest or other interest in the organization selected or to be selected for a
subaward. The officers. employees, and agents of the Recipient shall neither solicit nOr
accept anything of monetary value from subrecipients. However, the Recipient may set
standards for situations in which the financial interest is not substantial or the gift is an
unsolicited item of nominal value. The standards of conduct shall provide for disciplinary
23
actions to be applied for violations of such standards by officers, employees. or agents of
the Recipient.
c. A financial interest may include employment, stock ownership, a creditor or debtor
relationship. or prospective employment with the organization selected or to be selected for
a subaward. An appearance of impairment of objectivity could result from an
organizational conflict where. because of other activities or relationships with other persons
or entities. a person is unable or potentially unable to render impartial assistance or advice.
It could also result from non-financial gain to the individual, such as benefit to reputation
or prestige in a professional field.
4. ApplicabiJit)' of Provisions to Subawards, Contracts, and Subcontracts.
a. The Recipient shall include the following notice in each request for applications or bids:
Applicantslbidders for a lower tier covered transaction (except procurement contracts for
goods and services under $25,000 not requiring the consent ofa DOC official) are subject
to 2 C.F.R. part 1326, subpart e, "Governmelltwide Debarment and Suspension
(Nonprocurement)." In addition, applicantslbidders for a lower tier covered transaction for
a subaward, contract, or subcontract greater than $] 00,000 of federal funds at any tier are
subject to ] 5 C.F.R. part 28, "New Restrictions on Lobbying." Applicants/bidders should
familiarize themselves with these provisions, including the certification requirement.
Therefore, applications for a lower tier covered transaction must include a Form eD-5] 2,
"Certification Regarding Lobbying~Lower Tier Covered Transactions," completed without
modification.
b. The Recipient shall include a term or condition in all lower tier covered transactions
(subawards, contracts, and subcontracts), that the Award is subject to subpart e of
2 C.F.R. part 1326, "Governmentwide Debarment and Suspension (Nonprocurement)."
c. The Recipient shall include a statement in all lower tier covered transactions (subawards,
contracts, and subcontracts) exceeding $100,000 in federal funds, that the subaward,
contract. or subcontract is subject to 3] use ~ 1352, as implemented at ]5 C.F.R. part 28,
regarding new restrictions on lobbying. The Recipient shall further require the
subrecipient, contractor, or subcontractor to submit a completed Form SF-LLL,
"Disclosure of Lobbying Activities," regarding the use of non-federal funds for lobbying.
The Form SF-LLL shall be submitted within 15 days following the end of the calendar
quarter in which there occurs any event that requires disclosure or that materially affects
the accuracy of the information contained in any disclosure form previously filed. The
Form SF-LLL shall be submitted from tier to tier until received by the Recipient. The
Recipient must submit all disclosure forms received, including those that report lobbying
activity on its own behalf, to the Grants Officer within 30 days following the end of the
calendar quarter.
5. Minorit)'-Owned Business Enterprise. DOC encourages Recipients to utilize minority- and
women-owned firms and enterprises in contracts under financial assistance awards. The
Minority Business Development Agency will assist Recipients in matching qualified minority
owned enterprises with contract opportunities. For further information contact:
24
U.S. Department of Commerce
Minority Business Development Agency
1401 Constitution Avenue. N.W.
Washington. D.C. 20230
\Vebsite: \\ \\ \\ .ml'\lb.!..!(1\
6. Subaward and/or Contract to a Federal Agency.
The Recipient. subrecipient, contractor and/or subcontractor shall not subgrant or subcontract
any part of the approved Project to any agency or employee of DOC or other federal
department, agency, or instrumentality without the prior written approval of the Grants Officer.
Requests for approval of such action must be submitted to the Project Officer who shall review
and make a recommendation to the Grants Officer. The Grants Officer shall make the final
determination and will notifY the Recipient in writing of the final determination.
7. EDA Contracting Provisions for Construction Projects. The Recipient shall use the
"EDA Contracting Provisions for Construction Projects" as guidance in developing all
construction contracts. The "EDA Contracting Provisions for Construe/ion Projects" lists
applicable EDA and other federal requirements for construction contracts.
M. Property.
I. Standards. With respect to any property acquired or improved in whole or in part with EDA
investment assistance under this Award, the Recipient shall comply with the property
management standards found in EDA's regulations at 13 C.F.R. part 314. Property acquired or
improved in whole or in part by the Recipient under this Award may consist of real personal
property, including intangible property such as money. notes, and security interests. Any
inventory listings stipulated under the applicable uniform administrative requirements must be
submitted to the Grants Officer on Form CD-281, "Report of Government Property in
Possession of Contractor."
2. Retention of Title.
a. The Government shall determine who retains title to all nonexpendable personal property
in accordance with] 5 C.F.R. parts] 4 or 24, as applicable. Use, management, and the
disposition of such property will be in accordance with the requirements set out at
]5 C.F.R. parts 14 or 24, as applicable, and EDA's regulations at 13 C.F.R. part 3]4.
b. Title to real property (whether acquired partly or wholly with federal funds) will vest with
the Recipient subject to the condition that the Recipient uses the real property for the
authorized purpose of the Project.
3. EDA's Interest in Award Property.
a. Evidence of Title. Prior to the advertisement of bids or at such other time as EDA requires,
the Recipient must furnish evidence, satisfactory in form or substance to the Government,
that title to real property required for the Project (other than property of the United States
25
and as provided in 13 C.F.R. ~ 3J4.7(c)) is vested in the Recipient and that such
easements. rights-of-way. State or local government penn its. long-term leases. or other
items required for the Project have been or will be obtained by the Recipient within an
acceptable time. as determined by the Government. All liens. mortgages. other
encumbrances. reservations, reversionarv interests. or other restrictions on title or the
Recipient's interest in the property must'be disclosed to EDA. With limited exceptions set
forth in 13 C.F.R. ~ 3 J 4.6(b) or as otherwise authorized by EDA. Recipient-owned
property acquired or improved in "hole or in part with EDA investment assistance must
not be used to secure a mortgage or deed of trust or in any way otherwise encumbered.
See 13 C.F.R. ~ 314.6.
b. Recording EDA '5 Interest in Property.
(i) For all Projects involving the acquisition, construction, or improvement of a
building, as detennined by EDA, the Recipient shall execute and furnish to the
Government, prior to initial A ward disbursement, a lien, covenant, or other
statement. satisfactory to EDA in fonn and substance, of ED A's interest in the
property acquired or improved in whole or in part with the funds made available
under this Award. EDA may require such statement after initial Award
disbursement in the event that grant funds are being used to acquire such property.
The statement must specify the estimated useful life of the Project and shall include
but not be limited to the disposition, encumbrance, and the Federal Share
compensation requirements. See 13 C.F.R. ~~ 314. I and 3 14.8(a).
(ii) This lien. covenant, or other statement of the Government's interest must be
perfected and placed of record in the real property records of the jurisdiction in
which the property is located. all in accordance with applicable law. EDA shall
require an opinion of counsel for the Recipient to substantiate that the document has
been properly recorded. See 13 C.F.R. ~ 314.8(b).
(iii) Facilities in which the EDA investment is only a small part of a larger project, as
detennined by EDA. may be exempted from the requirements listed in paragraphs
M.3.b.(i) and (ii) above. See 13 C.F.R. ~ 314.8(c).
c. The Recipient acknowledges that the Government retains an undivided equitable
reversionary interest in the property acquired or improved in whole or in part with grant
funds made available through this Award throughout the estimated useful life (as
detennined by EDA) of the Project, except in applicable instances set forth in 13 C.F.R.
~ 314.7(c). See also 13 C.F.R. 9314.2(a).
d. The Recipient agrees that in the event that any interest in property acquired or improved in
whole or in part with EDA investment assistance is disposed of, encumbered or alienated
in any manner. or no longer used for the authorized purpose(s) of the Award during the
Project's estimated useful life without EDA's written approval, the Government will be
entitled to recover the Federal Share, as defined at 13 C.F.R. ~ 314.5. If, during the
Project's estimated useful life. the property is no longer needed for the purpose(s) of the
Award, as determined by EDk EDA may permit its use for other acceptable purposes
consistent with those authorized by PWEDA and 13 C.F.R. chapter III.
See 13 C.F.R. ~ 314.3(b).
26
e. For purposes of any lien or security interest, the amount of the Federal Share shall be the
portion of the current fair market value of any property (after deducting any actual and
reasonable selling and repair expenses incurred to put the property into marketable
condition) attributable to EDA's participation in the Project. See 13 C.F.R. S 314.5.
f. The alienation of Award property includes sale or other conveyance of the Recipient's
interest. leasing or mortgaging the property. or granting an option for any of the foregoing.
4. Insurance and Bonding.
a. Reeipients that are Institutions of Higher Edueation, Hospitals, Other Non-Profit and
Commercial Organizations. The Recipient shall, at a minimum, provide the equivalent
insurance coverage for real property and equipment acquired with federal funds as
provided to property owned by the Recipient. Federally-owned property need not be
insured unless required by the terrns and conditions of the award. See 15 C.F.R. S 14.31.
b. Recipients that are State and Loeal Governments. If the Award exceeds the simplified
acquisition threshold, EDA may accept the Recipient's or subrecipient's bonding policy
and requirements if EDA deterrnines that the Federal Interest is adequately protected. If
not, the following minimum requirements shall apply:
(i) A bid guarantee from eaeh bidder equivalent to five pereent of the bid priee. The
"bid guarantee" shall consist of a firm commitment such as a bid bond, certified
check, or other negotiable instrument accompanying a bid as assurance that the
bidder will, upon acceptance of the proffered bid, execute such contractual
documents as may be required within the time specified;
(ii) A performance bond un the part of the eontraetor for 100 percent of the contract
price. A "perforrnance bond" is one executed in connection with a contract to secure
fulfillment of all the contractor's obligations under such contract: and
(iii) A payment bond on the part of the contractor for 100 percent of the contract price.
A "payment bond" is one executed in connection with a contract to assure payment
as required by law of all persons supplying labor and material in the execution of the
work provided for in the contract. See 15 C.F.R. S 24.36(h)
5. Leasing Restrictions. Leasing or renting offacilities or property is prohibited unless
specifically authorized by EDA. The Recipient agrees that any leasing or renting of any
facilities or property involved in this Project will be subject to the following:
a. That said lease arrangement is consistent with the authorized general and special purpose
of the Award;
b. That said lease arrangement is for adequate consideration: and
c. That said lease arrangement is consistent with applicable EDA requirements concerning
but not limited to nondiscrimination and environmental compliance.
6. Use of Eminent Domain Prohibited. The Recipient will use funds solely for the authorized
use of the Project. Pursuant to Executive Order 13406, "Protecting the Property Rights of the
American People," the Recipient agrees:
27
a. Not to use any power of eminent domain available to the Recipient (including the
commencement of eminent domain proceedings) for use in connection with the Project for
the purpose of advancing the economic interests of private parties; and
b. Not to accept title to land. easements. or other interests in land acquired by the use of any
power of eminent domain for use in connection with the Project for such purposes.
The Recipient agrees that any use of the power of eminent domain to acquire land. easements,
or interests in land, whether by the Recipient or any other entity that has the power of eminent
domain. in connection with the Project without prior written consent of EDA is an
unauthorized use of the Project. If the Recipient puts the Project to an unauthorized use, the
Recipient shall compensate EDA for its fair share in accordance with 13 C.F.R. 99 314.4 and
314.5, as same may be amended from time to time.
7. Disposal of Real Property.
a. If EDA and the Recipient determine that property acquired or improved in whole or in part
with EDA investment assistance is no longer needed for the original purpose(s) of this
A ward, the Recipient must obtain approval from the Government to use the property in
other federal grant programs or in programs that have purposes consistent with those
authorized by PWEDA and 13 C.F.R. chapter III. See 13 C.F.R. 9314.3(b).
b. When property is not disposed of as provided in section M.7.a. above, the Government
shall determine final disposition and must be compensated by the Recipient for the Federal
Share of the value of the property, plus costs and interest, as provided in 13 C.F.R.
9314.4.
N. Environmental Requirements.
Environmental impacts must be considered by federal decision-makers in their decisions whether or
not to: (i) approve a proposal for federal assistance; (ii) approve the proposal with mitigation; or
(iii) approve a different proposal/grant having less adverse environmental impacts. Federal
environmental laws require that the funding agency initiate a planning process with early
consideration of potential environmental impacts that Project(s) funded with federal assistance may
have on the environment. The Recipient and any subrecipients shall comply with all environmental
standards, to include those prescribed under the following statutes and Executive Orders. and shall
identify to the awarding agency any impact the Award may have on the environment. In some
cases, the Grants Officer can withhold A ward funds under a special award condition requiring the
Recipient to submit additional environmental compliance information sufficient to enable the
Department to make an assessment on any impacts that a Project may have on the environment.
I. The National Environmental Policy Act of 1969 (42 U.S.c. ~ 4321 et seq.)
The National Environmental Policy Act ("NEPA") and the Council on Environmental Quality
("CEQ") implementing regulations (40 C.F.R. parts 1500 - 1508) require that an
environmental analysis be completed for all major federal actions significantly affecting the
environment. NEPA applies to the actions of federal agencies and may include a federal
agency's decision to fund non-federal projects under grants and cooperative agreements.
Recipients of federal assistance are required to identity to the awarding agency any impact an
award will have on the quality of the human environment and assist the agency to comply
with NEPA. Recipients may also be requested to assist EDA in drafting an environmental
28
assessment if EDA detennines an assessment is required. If additional inf0rmation is required
during the period of the Award, funds can be withheld by the Grants Officer under a special
award condition requiring the Recipient to submit additional environmental compliance
infonnation sufficient to enable EDA to make an assessment on any impacts that the Project
may have on the environment.
2. Environmental Quality Improvement Act of 1970, as amended (42 U.S.c.
SS 4371 - 4375)
Federally-supported public works facilities and activities that affect the environment shall be
implemented in compliance with policies established under existing law.
3. Executive Order 12088, "Federal Compliance with Pollution Control Standards,"
(43 Fed. Reg. 47707, October 13, ]978), as amended
All necessary actions shall be taken for the prevention. control, and abatement of
environmental pollution with respect to federally-supported facilities and activities
4. Executive Order 11514, "Protection and Enhancement of Environmental Quality,"
(35 Fed. Reg. 4247, March 5,1970), as amended
Federally-supported facilities and activities shall be maintained and directed to meet national
environmental goals.
5. Executive Order] 1593, "Protection and Enhancement of the Cultural Environment,"
(36 Fed. Reg. 892], May 13, ]971), as amended
Federally-owned sites, structures, and objects of historical, architectural, or archaeological
significance shall be preserved, restored, and maintained.
6. Clean Air Act, Clean Water Act, and Executive Order]] 738
Recipients must comply with the provisions of the Clean Air Act (42 USe. Ij 7401 et seq.),
the Clean Water Act (42 USe. Ij 1251 et seq.), and Executive Order 11738, and shall not use
a facility on the Environmental Protection Agency's ("EPA") List of Violating Facilities in
performing any A ward that is nonexempt under 2 e.F.R. Ij 1532, and shall notify the EDA
Project Officer in writing ifit intends to use a facility that is on EPA's List of Violating
Facilities or knows that the facility has been recommended to be placed on the List.
7. The Safe Drinking Water Act of ]974, as amended (42 U.S.c. S 300f et seq.)
This Act precludes federal assistance for any project that the EPA detennines may
contaminate a sole source aquifer so as to threaten public health.
8. Executive Order 11988, "Floodplain Management," (42 Fed. Reg. 2695], May 24, ]977)
and Executive Order] ]990, "Protection of Wetlands," (42 Fed. Reg. 2696],
May 24, ]977)
Recipients must identify proposed actions in federally-defined floodplains and wetlands to
enable the agency to make a detennination whether there is an alternative to minimize any
potential hann.
9. The Flood Disaster Protection Act of ]973, as amended (42 U.S.c. S 4002 et seq.), and
regulations and guidelines issued thereunder by the U.S. Federal Emergency
Management Administration ("FEMA") or by EDA
Flood insurance, when available, is required for federally-assisted construction or acquisition
in flood-prone areas.
29
10. The Coastal Zone Management Act of 1972, as amended (I6l'.S.C. S 1451 et seq.)
Funded projects must be consistent with a coastal State's approved management plan for the
coastal zone.
II. The Coastal Barrier Resources Act, as amended, (16 li.S.C. S 3501 et seq.)
Restrictions are placed on federal funding for actions within a Coastal Barrier System.
12. The Wild and Scenic Rivers Act, as amended, (I6l'.S.C. S 1271 et seq.)
This Act applies to awards that may affect existing or proposed components of the National
Wild and Scenic Rivers system.
13. The Fish and Wildlife Coordination Act, as amended, (16 U.S.C. S 661 et seq.)
Requiring the evaluation the impacts to fish and wildlife from federally-assisted proposed
water resource development projects.
14. The Endangered Species Act of 1973, as amended, (16 U.S.c. S 1531 et seq.)
The Recipient must identify any impact or activities that may involve a threatened or
endangered species. Federal agencies have the responsibility to ensure that federal awards do
not adversely affect protected species or habitats and must conduct the required reviews under
the Endangered Species Act.
15. The Comprehensive Environmental Response, Compensation, and Liability Act of 1980
("CERCLA") (42 U.S.c. S 9601 et seq.), as amended by the Superfund Amendments and
Reauthorization Act of 1986 (42 U.S.c. S 9662 et seq.)
These requirements address responsibilities of hazardous substance releases, threatened
releases, and environmental cleanup. There is also a requirement to impose reporting and
community involvement requirements to ensure disclosure of the release or disposal of
regulated substances and cleanup of hazards.
16. The Resource Conservation and Recovery Act of 1976, as amended,
(42 U.S.c. S 6901 et seq.)
This Act regulates the generation, transportation, treatment. and disposal of hazardous wastes.
and also provides that Recipients of federal funds give preference in their procurement
programs to the purchase of recycled products pursuant to EP A guidelines.
17. Executive Order 12898, "Federal Actions to Address Environmental Justice in Minority
Populations and Low-Income Populations" (59 Fed. Reg. 7629, February II, 1994)
This Order identifies and addresses adverse human health or environmental effects of
programs, policies, and activities on low-income and minority populations.
18. The Lead-Based Paint Poisoning Prevention Act, as amended, (42 U.S.c. S 4821 et seq.)
Use of lead-based paint in residential structures constructed or rehabilitated by the Federal
Government or with federal assistance is prohibited.
19. The Farmland Protection Policy Act, as amended, (7 U.S.c. SS 4201 - 4209)
Projects are subject to review under this Act if they may irreversibly directly or indirectly
convert farmland. including forest land, pastureland, cropland. or other land, to
nonagricultural use.
30
20. The Noise Control Act of 1972, as amended, (42 U.S.c. ~ 4901 et seq.)
Federally-supported facilities and activities shall comply with federal. State. interstate, and
local requirements respecting control and abatement of environmental noise to the same
extent that any person is subject to such requirements.
21. The ;>;ative American Graves Protection and Repatriation Act, as amended,
(25 L.S.C. ~ 3001 et seq.)
This Act provides a process for returning certain Native American cultural items to lineal
descendants, culturally affiliated Indian Tribes, and Native Hawaiian organizations.
O. Compliance with Environmental Requirements. The Recipient agrees to notify the Grants
Officer of any environmental requirement or restriction, regulatory or otherwise, with which it must
comply. Before Project Closeout and final disbursement of Award funds, the Recipient further
agrees to provide evidence satisfactory to the Grants Officer that any required environmental
remediation has been completed: (]) in compliance with all applicable federal, State and local
regulations; and (2) as set forth in the applicable Lease, Finding of Suitability to Lease ("FOSL"),
Lease in Furtherance of Conveyance, Quitclaim Deed, or other conveyance instrument and any
amendments, supplements, or succeeding documents. Com pi iance with said laws or restrictions
shall be included in any contract documents for Project construction. The Recipient must certify
compliance before final disbursement of grant funds.
P. Miscellaneous Requirements.
I. Criminal and Prohibited Activities.
a. The Program Fraud Civil Remedies Act (3] U.S.e. ~~ 3801-3812) provides for the
imposition of civil penalties against persons who make false, fictitious. or fraudulent
claims to the Federal Government for money (including grants, loans, or other benefits).
b. The Criminal False Claims Act and the False Statements Act (18 USe. 99287 and ]00])
provide for criminal prosecution of a person who knowingly makes or presents any false,
fictitious, or fraudulent statements or representations or claims against the United States.
Such person shall be subject to imprisonment of not more than five years and shall be
subject to a fine.
c. The Civil False Claims Act (3] U.S.e. 93729) provides that suits under this Act can be
brought by the Federal Government, or a person on behalf of the Federal Government, for
false claims under federal assistance programs.
d. The Copeland "Anti-Kickback" Act (18 USe. 9 874 and 40 U.S.e. 9 276c), prohibits a
person or organization engaged in a federally-supported Project from enticing an
employee working on the Project from giving up a part of his compensation under an
employment contract.
2. Foreign Travel.
a. The Recipient shall comply with the provisions of the Fly America Act (49 USe.
940] 18). The implementing regulations of the Fly America Act are found at
41 e.F.R. 99 301-10.131-301.]0.]43.
31
b. The Fly America Act requires that federal travelers and others performing federal
government-financed foreign air travel must use United States flag air carriers, to the
extent that service by such carriers is available. Foreign air carriers may be used only in
specific instances, such as when a United States flag air carrier is unavailable. or use of
United States flag air carrier service will not accomplish the agency's mission.
c. Use of foreign air carriers may also be used only if bilateral agreements permit such travel
pursuant to 49 U.s.e. S 40 I IS(b). The Department is not aware of any bilateral
agreements that meet these requirements. Therefore, it is the responsibility of the
Recipient to provide the Grants Officer with a copy of the applicable bilateral agreement if
use of a foreign carrier under a bilateral agreement is anticipated.
d. If a foreign air carrier is anticipated to be used, the Recipient must receive prior approval
from the Grants Officer. When requesting such approval in accordance with the guidance
provided by 41 e.F.R. S 301-10.142, the Recipient must provide a "certification" the
Grants Officer with the following: (i) his or her name; (ii) dates of travel; (iii) the origin
and destination of travel; (iv) a detailed itinerary of travel; (v) the name of the air carrier
and flight number for each leg of the trip; (vi) and a statement explaining why the
Recipient meets one of the exceptions to the applicable regulations. If the use ofa foreign
air carrier is pursuant to a bilateral agreement, the Recipient must provide the Grants
Officer with a copy of the agreement. The Grants Officer shall make the final
determination and notify the Recipient in writing. Failure to adhere to the provisions of
the Fly America Act will result in the Recipient not being reimbursed for any
transportation costs for which the Recipient improperly used a foreign air carrier.
3. American-Made Equipment and Products. Recipients are hereby notified that they are
encouraged, to the greatest extent practicable, to purchase American-made equipment and
products with funding provided under this Award.
4. Intellectual Property Rights.
a. Inventions. The intellectual property rights to any invention made by a Recipient under a
DOC Award are determined by the Bayh-Dole Act, as amended (Pub. L. No. 96-517), and
codified in 35 U.s.e. S 200 el seq., except as otherwise required by law. The specific
rights and responsibilities are described in more detail in 37 e.F.R. part 401, and in the
particular, in the standard patent rights clause in 37 e.F.R. S 401.14, which is hereby
incorporated by reference into this Award.
(i) Ownership.
(a) Recipient. The Recipient has the right to own any invention it makes
(conceived or first reduced to practice) or that is made by its employees. The
Recipient may not assign its rights to a third party without the permission of
the Department unless it is to a patent management organization (i.e., a
university's research foundation.) The Recipient's ownership rights are subject
to the Federal Government's nonexclusive paid-up license and other rights.
(b) Department. If the Recipient elects not to own or does not elect rights or file a
patent application within the time limits set forth in the standard patent rights
clause, the Department may request an assignment of all rights, which is
32
nonnally subject to a limited royalty free non-exclusive license for the
Recipient. The Department owns any invention made solely by its employees.
but may license the Recipient in accordance with the procedures in 37 C.F.R.
part 404.
(c) Inventor/Employee. Ifneither the Recipient nor the Department is interested in
owning an invention by a Recipient employee, the Recipient, with the written
concurrence of the Department's Patent Counsel, may allow the
inventor/employee to own the invention subject to certain restrictions as
described in 37 C.F.R. ~ 401.9.
(d) Joint Inventions. Inventions made jointly by a Recipient and a Department
employee will be owned jointly by the Recipient and DOC. However, the
Department may transfer its rights to the Recipient as authorized by 35 U.S.c.
~ 202(e) and 37 C.F.R. ~ 401.10 if the Recipient is willing to patent and license
the invention in exchange for a share of "net" royalties based on the number of
inventors (e.g., 50-50 if there is one Recipient and Department employee). The
agreement will be prepared by the Department's Patent Counsel and may
include other provisions, such as a royalty free license to the Federal
Government and certain other entities. The Recipient also is authorized to
transfer its rights to the Federal Government, which can agree to share royalties
similarlv as described above (35 U.S.c. ~ 202(e)).
(ii) Responsibilities -iEdison. The Recipient has responsibilities and duties set forth in
the standard patent rights clause, which are not described below. The Recipient is
expected to comply with all the requirements of the standard patent rights clause and
37 C.F.R. part 401. Recipients of DOC Awards are required to submit their
disclosures and elections electronically using the Interagency Edison extramural
invention reporting system (iEdison) at \vww.iedison.gov. The Recipient may obtain
a waiver of this electronic submission requirement by providing DOC compelling
reasons for allowing the submission of paper copies of reports related to inventions.
b. Patent Notification Procedures. Pursuant to Executive Order 12889, the Department is
required to notify the owner of any valid patent covering technology whenever the
Department or its Recipients, without making a patent search, knows (or has demonstrable
reasonable grounds to know) that technology covered by a valid United States patent has
been or will be used without a license from the owner. To ensure proper notification, if
the Recipient uses or has used patented technology under this A ward without a license or
permission from the owner, the Recipient must notify the Grants Officer:
However, this notice does not necessarily mean that the Government authorizes and
consents to any copyright or patent infringement occurring under the financial assistance.
c. Data, Databases, and Software. The rights to any work produced or purchased under a
DOC Award are detennined by 15 C.F.R. ~~ 14.36 or 24.34, as applicable. Such works
may include data, databases, or software. The Recipient owns any work produced or
purchased under a DOC Award subject to the Department's right to obtain, reproduce,
publish, or otherwise use the work or authorize others to receive, reproduce, publish, or
otherwise use the data for Federal Government purposes.
I
L
33
d. Copyright. The Recipient may copyright any work produced under a DOC Award
subject to the Department's royalty-free, non-exclusive, and irrevocable right to
reproduce, publish or otherwise use the work or authorize others to do so for Federal
Government purposes. Works jointly authored by the Department and Recipient
employees may be copyrighted, but only the part authored by the Recipient is protected
under 17 USe. S 105, which provides that works produced by Federal Government
employees are not copyrightable in the United States. I f the contributions of the authors
cannot be separated, the copyright status of the joint work is questionable. On occasion,
the Department may ask the Recipient to transfer to the Department its copyright in a
particular work when the Department is undertaking the primary dissemination of the
work. Ownership of copyright by the Federal Government through assignment is
permitted under 17 USe. S 105,
5. Increasing Seat Belt Use in the United States. Pursuant to Executive Order 13043,
Recipients should encourage employees and contractors to enforce on-the-job seat belt
policies and programs when operating company-owned, rented, or personally-owned vehicles.
6. Research Involving Human Subjects.
a. All proposed research involving human subjects must be conducted in accordance with
15 e.F.R. part 27, "Protection of Human Subjects." No research involving human
subjects is permitted under this A ward unless expressly authorized by special award
condition or otherwise authorized in writing by the Grants Officer.
b. Federal policy defines a human subject as a living individual about whom an investigator
conducting research obtains (i) data through intervention or interaction with the
individual, or (ii) identifiable private information. Research means a systematic
investigation, including research development, testing and evaluation, designed to develop
or contribute to generalizable knowledge.
c. The Department's regulations at 15 e.F.R. part 27 require that Recipients maintain
appropriate policies and procedures for the protection of human subjects. In the event it
becomes evident that human subjects may be involved in carrying out the purpose(s) of
this Award, the Recipient shall submit appropriate documentation to the Project Officer
for approval. This documentation may include:
(i) Documentation establishing approval of the Project by an institutional review board
("IRB") approved for government-wide use under Department of Health and Human
Services guidelines (see 15 e.F.R. S 27.103);
(ii) Documentation to support an exemption for the Project under 15 e.F.R. S 27.10 I (b);
(iii) Documentation to support deferral for an exemption or IRB review under 15 e.F.R.
S 27.118; or
(iv) Documentation oflRB approval of any modification to a prior approved protocol or
to an informed consent form.
d. No work involving human subjects may be undertaken, conducted, or costs incurred or
charged for human subjects research until the appropriate documentation is approved in
34
writing by the Grants Officer. Notwithstanding this prohibition, work may be initiated or
costs incurred or charged to the Project for protocol or instrument development related to
human subjects research.
7. Federal Employee Expenses. Federal agencies are generally barred from accepting funds
from a Recipient to pay transportation, travel, or other expenses for any federal employee
unless specifically approved in the terms of the Award. Use of Award funds (federal or non-
federal) or the Recipient's provision of in-kind goods or services for the purposes of
transportation, travel, or any other expenses for any federal employee may raise appropriation
augmentation issues. In addition, DOC policy prohibits the acceptance of gifts, including
travel payments for federal employees, from Recipients or applicants regardless of the source.
8. Preservation of Open Competition and Government Neutrality Towards Government
Contractors' Labor Relations on Federal and Federally-Funded Construction Projects.
Pursuant to Executive Order 13202, "Preservation of Open Competition and Government
Neutrality Towards Government Contractors' Labor Relations on Federal and Federally-
Funded Construction Projects," as amended by Executive Order 13208, unless the Project is
exempted under section 5(c) of the Order, bid specifications, Project-related agreements, or
other controlling documents for construction contracts awarded by Recipients or any
construction manager acting on their behalf, shall not:
a. Include any requirement or prohibition on bidders, offerors, contractors, or subcontractors
about entering into or adhering to agreements with one or more labor organizations on the
same or related construction Project(s); or
b. Otherwise discriminate against bidders, offerors, contractors, or subcontractors for
becoming or refusing to become or remain signatories or otherwise to adhere to
agreements with one or more labor organizations, on the same or other related
construction Project(s).
9. Minority Serving Institutions ("MSls") Initiative. Pursuant to Executive Orders 13256,
"President's Board of Advisors on Historically Black Colleges and Universities," 13230
"President's Advisory Commission on Educational Excellencefor Hispanic Americans," and
13270, "Tribal Colleges and Universities," the Department is strongly committed to
broadening the participation ofMSIs in its financial assistance programs. The Department's
goals include achieving full participation of MSIs in order to advance the development of
human potential, strengthen the nation's capacity to provide high-quality education, and
increase opportunities for MSIs to participate in and benefit from federal financial assistance
programs. The Department encourages all applicants and Recipients to include meaningful
participation ofMSIs. Institutions eligible to be considered MSls are listed on the U,S.
Department of Education's website.
10. Research Misconduct. Scientific or research misconduct refers to the fabrication,
falsification or plagiarism in proposing, performing, or reviewing research, or in reporting
research results. It does not include honest errors or differences of opinion. The Recipient
organization has the primary responsibility to investigate allegations and provide reports to
the Federal Government. Funds expended on an activity that is determined to be invalid or
unreliable because of scientific misconduct mav result in a disallowance of costs for which the
institution may be liable for repayment to the aZvarding agency. The Office of Science and
Technology Policy at the White House published in the Federal Register on December 6,
35
2000 a final policy that addressed research misconduct (65 Fed. Reg. 76260). The policy was
developed by the National Science and Technology Council. The Department requires that
any allegation be submitted to the Grants Officer. who also will notify the OIG of such
allegation. Generally, the Recipient organization shall investigate the allegation and submit
its findings to the Grants Officer. The Department may accept the Recipient's findings or
proceed with its own investigation. The Grants Officer shall inform the Recipient of the
Department's final determination.
I I. Publications, Videos, and Acknowledgment of Sponsorship. Publication of the results or
findings of a research Project in appropriate professional journals and production of video or
other media is encouraged as an important method of recording and reporting scientific
information. It is also a constructive means to expand access to federally-funded research.
The Recipient is required to submit a copy to the funding agency and when releasing
information related to a funded Project include a statement that the Project or effort
undertaken was or is sponsored by DOe. The Recipient also is responsible for ensuring that
every publication of material (including Internet sites and videos) based on or developed
under an A ward, except scientific articles or papers appearing in scientific, technical or
professional journals, contains the following disclaimer: "This [report/video] was prepared by
[Recipient name] under [A ward number] from [name of operating unit), u.S. Department of
Commerce. The statements, findings, conclusions and recommendations are those of the
author(s) and do not necessarily reflect the views of the [name of operating unit] or the U.S.
Department of Commerce." This disclaimer also applies to videos produced under DOC
Awards.
I 2. Care and Use of Live Vertebrate Animals. Recipients must comply with the Laboratory
Animal Welfare Act of I 966 (Pub. L. No. 89-544), as amended (7 u.s.e. 92131 el seq.)
(animal acquisition, transport, care, handling, and use in projects), and the implementing
regulations at 9 e.F.R. parts 1.2, and 3; the Endangered Species Act (16 USe.
9 1531 el seq.); the Marine Mammal Protection Act (16 USe. 9 1361 et seq.) (taking
possession, transport, purchase, sale, export or import of wildlife and plants); the
Non-indigenous Aquatic Nuisance Prevention and Control Act (16 USe. 94701 el seq.)
(ensure preventive measures are taken or that probable harm of using species is minimal if
there is an escape or release); and all other applicable statutes pertaining to the care, handling,
and treatment of warm blooded animals held for research, teaching, or other activities
supported by federal financial assistance. No research involving vertebrate animals is
permitted under any DOC A ward unless authorized by the Grants Officer.
13. Homeland Security Directive. If the performance of this Award requires the Recipient to
have physical access to federal premises for more than 180 days or access to a federal
information system, personal identity verification procedures must be implemented. Any
items or services delivered under this Award shall comply with the Department's personal
identity verification procedures that implement Homeland Security Presidential
Directive - 12, FIPS PUB 201, and OMB Memorandum M-05-24. The Recipient shall insert
this clause in all subawards or contracts when the subaward recipient or contractor is required
to have physical access to a federally-controlled facility or access to a federal information
system.
36
14. Compliance with Department of Commerce Bureau of Industry and Securil)' Export
Administration Regulations.
a. This clause applies to the extent that this A ward involves access to export-controlled
information or technology.
b. In performing this Award, the Recipient may gain access to export-controlled information
or technology. The Recipient is responsible for compliance with all applicable laws and
regulations regarding export-controlled information and technology, including deemed
exports. The Recipient shall establish and maintain throughout performance of this A ward
effective export compliance procedures at non-DOC facilities. At a minimum, these
export compliance procedures must include adequate controls of physical, verbal, visual,
and electronic access to export-controlled information and technology.
c. Definitions.
(i) Deemed Export. The Export Administration Regulations ("EAR") define a deemed
export as any release of technology or source code subject to the EAR to a foreign
national, both in the United States and abroad. Such release is "deemed" to be an
export to the home country of the foreign national. See 15 C.F.R. S 734.2(b)(2)(ii).
(ii) Export-controlled information and technology. Export-controlled information and
technology subject to the EAR (15 C.F.R. SS 730-774), implemented by the
Department's Bureau of Industry and Security, or the "International Traffic In Arms
Regulations" ("IT AR") (22 C.F.R. SS 120-130), implemented by the Department of
State, respectively. This includes but is not limited to dual-use items, defense
articles and any related assistance, services, software, or technical data as defined in
the EAR and IT AR.
d. The Recipient shall control access to all export-controlled information and technology that
it possesses or that comes into its possession in performance of this A ward, to ensure that
access is restricted, or licensed, as required by applicable federal laws, Executive Orders,
or regulations.
e. Nothing in the Terms and Conditions of this Award is intended to change, supersede or
waive the requirements of applicable federal laws, Executive Orders, or regulations.
f. The Recipient shall include this subsection entitled "Compliance with Department of
Commerce Bureau of Industry and Security Export Administration Regulations,"
including this subparagraph (t), in all lower-tier transactions (sub-awards, contracts, and
subcontracts) under this Award that may involve access to export-controlled information
technology.
37
APPENDIX
THE FOLLOWING REFERENCE MA TERIALS AND FORMS ARE A VAILABLE ONLINE:
I. 2 C.FR. part 220 (codifying OMB Circular A-21, "Cost Principles for Educational Institutions")
2. 2 C.F.R. part 225 (codifying OMB Circular A-87, "Cost Principlesfor State, Local and Indian Tribal
Governments" )
3. 2 C.F.R. part 230 (codifying OMB Circular A-122, "Cost Principlesfor Nonprofit Organizations")
4. 2 C.F.R. part] 326, "Non-Procurement Debarment and Suspension"
5. 13 C.F.R. chapter II] (EDA's regulations)
6. 15 C.F .R. part 14, "Uniform Administrative Requirements for Grants and Agreements with
Institutions of Higher Education, Hospitals. Other Non-Profit and Commercial Organizations"
(codifying OMS Circular A-II 0)
7. 15 C.F.R. part 24, "Uniform Administrative Requirements for Grants and Cooperative Agreements to
State and Local Governments"
8. ] 5 C.F .R. part 4, "Disclosure of Government Information"
9. 15 C.F.R. part 27, "Protection of Human Subjects"
10. ] 5 C.F.R. part 28, "New Restrictions on Lobbying"
II. 15 C.F.R. part 29, "Government-wide Requirementsfor Drug-Free Workplace (Financial
Assistance)"
12. 48 C.F.R. part 31, "Contract Cost Principles and Procedures"
13. OMS Circular A-I 02, "Grants and Cooperative Agreements with State and Local Governments"
14. OMS Circular A-] 33, "Audits of States. Local Governments and Nonprofit Organizations," and the
related ComplIance Supplement
To access EDA '.I regulations. visit EDA '.I Internet website at
w>t 1\'. eda .zov/lnves tm en ts Gran ts/Laws reZ.xml.
To access the Code of Federal Regulations (C.F.R.), visit the Government Printing Office '.I Internet
website at hll/J://ec(r.Z/Joaccess.zov!czi/t/text/text-idx? c - ec(r&ml-%2Findex.ml.
To access the OA1B Circulars. visit OMB's Internet website at
www. whitehouse.zov/omb!circulars/index. html.
To access the Davis Bacon wage rate determinations. visit the Department of Labor '.I Internet website at
\1-1.\/11'. \vdol.f!ov/.
38
EDA FORMS:
1. Form CD-281, "'Report of Government Propert)' in Possession of Contractor"
2. Form CD-451. "Amendment to Financial Assistance Award"
3. Form CD-346, "'Identification - Applicantfor Funding Assistance"
4. Form SF-269. "'Financial Status Report"
5. Form SF-270. "'Request for Advance or Reimbursement"' (with Instructions)
6. Form SF-271. "'Outlay Report and Request for Reimbursement for Construction Programs"
7. Form SF-272, "Federal Cash Transaction Report"
8. Form SF-LLL. "'Disclosure of Lobbying Activities"
To access Department of Commerce forms ("CD "), visit the Department's Internet website at
ht/.D://ocio. os. doc. eov/ITPolicvandProerams/Electronic Forms/index. htm.
To access the Standard Forms ("SF"), visit the General Services Administration's Internet website at
wwwesa.f!ov/Portal/f!sa/e/J/(ormslibrarv.do?(ormTVlJe=SF.
39
Exhibit "8"
The Development Project
13
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Exhibit "C"
Grant Project Related COA's
14
F:\ WILSON\Agreements\Hillwood Reimbursement Agreement 9~29-08b.doc
Condition
2.s.
, 2.w.
I 2.z.
I 3.h.
Exhibit "C"
Deferred Conditions of Approval
Development Permit 2 No. 06-23
Oescri tion
An accessible path of travel shall be provided from the public
way to each building entrance. All pathways shall be concrete
I paved and shall provide a minimum clear width of 4 feet. Where
, parking overhangs the pathway, the minimum paved width shall
i be 6.5 feet.
The public right-of-way, between the property line and top of
curb (also known as "parkway") along Cajon Blvd. shall be
landscaped by the developer and maintained in perpetuity by the
property owner. Details of the parkway landscaping shall be
included in the ro 'ecl's on-site landsca elan.
. The required landscape maintenance district shall be formed and
I landscaping and irrigation system shall be installed in the
landscape maintenance district and accepted by the City Engineer
rior to a lication for occu anc of an buildin in the roO ect.
All existing overhead utilities adjacent to or traversing the site on
either side of the street shall be undergrounded in accordance
with Section 19.20.030 (non-subdivisions) or Section 19.30.110
(subdivisions of the Develo ment Code.
Comments
The paths of
. travel have
been installed
up to the future
sidewalk. The
connection to
the sidewalk
will occur
through
construction of
the Grant
Pro' ecl.
,
The LMD has I
I
been fom1ed.
Installation to
be de felTed.
6.3.
16.h.
I
i 6.c.
I
! All public streets and public easements within and adjacent to the
I development shall be improved to include combination curb and
I gUlter, paving, access ramps, street lights, sidewalks, and
. appurtenances, including, but not limited to traffic signals, traftic
, signal modifications, relocation of public or private facilities
, which interfere with new construction, striping, and landscaping
and irrigation in the landscape maintenance district shall be
accomplished in accordance with the City of San Bernardino
"Design Policies and Procedures" and City "Standard Drawings,"
unless otherwise approved by the City Engineer. Street lighting
shall be designed and constructed in accordance with the City's
"Street Lighting Policies and Procedures." Street lighting shall be
shown on street improvement plans except where otherwise
i approved by the City Engineer.
I For the streets listed below, dedication of adequate street right-of-
way (R.W.) to provide the distance from street centerline to
I property line and placement of the curb line in relation to the
i centerline:
I
I
I Cajon Blvd. - Dedicate right of way to 52' from centerline and
, improve the street with curb at 40' from centerline. Existing
I pavement shall be rehabilitated to centerline in a method
approved by the City Engineer. Horizontal design of the curb
returns at Cajon Blvd. and the new alignment of Glen Helen
Parkway shall be designed but not be constructed. Temporary
AC dikes shall be installed across the intersection location.
Glen Helen Parkway - Developer shall dedicate right of way for
Glen Helen Parkway along a new alignment to be determined by
the County of San Bernardino. The dedication shall be from
Cajon Blvd. across the entire project parcel. The new right of
way shall be 44' each side of the centerline. The right-of-way
dedication will reduce the number of parking spaces on site. In
the event that the dedication of Glen Helen Parkway would
reduce the number of parking spaces on site to less than the
minimum number required by the City Development Code
(Chapter 19.24) then replacement parking shall be provided,
sufficient to meet the minimum number of parking spaces
required by the Code. The City of San Bernardino will not seek
right of way dedication that would require alteration to Building
A, the northernmost building on the site plan. Curb returns at
i Cajon Blvd. shall be 35' radius.
t Construct 8" Curb and Gutter per City Standard No. 200 adjacent
I to the site. Widen pavement adjacent to the site to match new
I curb and gutter. Construct approach and departure transitions for
traffic safet and draina e as a roved b the Cit En ineer.
6.d.
, 6.e.
6.g.
6.h.
6.i.
Construct sidewalk adjacent to the site in accordance with City
Standard No. 202, Case "A" (6' wide ad'acent to curb).
Install Route 66 pavers in the public sidewalk along Cajon BId.
at spacing nO! exceeding 50 feet on center. Approved pavers are
available for purchase at cost, from the Development Services
Department.
Construct accessible curb ramps in accordance with City
Standard No. 205, modified as approved by the City Engineer to
comply with current ADA accessibility requirements, at all curb
returns within and adjacent to the project site. Dedicate sufficient
ri ht-of-wa at the comer to accommodate the ram .
Construct Driveway Approaches per City Standard No. 204, Type
II, including an accessible by-pass around the top of the drive
approach
i The pavement on existing streets adjoining the site shall be
i rehabilitated to centerline using a strategy approved by the City
I En ineer.
Installation of
pavers will
. occur during
construction of
i the Grant
i Project.
I Hillwood to
; purchase
pavers (not part
of grant).
Exhibit "D"
Form Letter of Credit
15
F:\WILSON\Agreements\H.illwood Reimbursement Agreement 9-29-08b.doc
WEllS FARGO BANK, N.A.
lllADE SERVICES DIVISION, NORTHERN CAUFORNIA
ONE FRONT STREET, 21" FLOOR
SAN FRANasco, CAUFORNIA 94111
COntact Phone: 1(800)798-2815 (Option 1)
Emall: _Owellsfarvo.com
IRREVOCABLE LETTER OF CREDIT
City of San Bemardino
300 N. "D" Street
San Bernardino, CA 92418
Attn: Development Services Department
Letter of Credit No. NZS625412
Date: July 2S, 2008
Ladies and Gentlemen:
At the request and for the account of North San Bernardino Industrial Park, LP., 268 W. Hospitality Lane,
Suite 105, San Bemardlno, CA 92408, attn: Kathy Undley, we hereby establish our Irrevocable Letter of Credit
in your favor In the amount of Three Million Seven Hundred Fifty Thousand and OO{l00's United States Dollars
(U5$ 3,750,000.(0) available with us at our above offlce by sight payment of your signed and dated demand(s)
worded as follows with the instructJons in brackets therein complied with:
"The undersigned, the Director of Development Services Department of the aty of San
Bernardino (the "City"), herebY demands US$[ins.t amount of drawing] under Wells Fargo
Bank, N.A. Letter of Credit No. NZS625412 and certifies that there has been a default by North
San Bemardlno IndustJial Park, LP. (the "Principal") of a payment obligation under that certain
Reimbursement Agreement between the aty and Principal and the amount drawn under Wells
Fargo Bank, N.A. Letter of Credit No. NZS625412 is therefore now due and payable."
Partial and multiple drawings are permitted under this Letter of Credit
If any instructions accompanying a drawing under this Letter of O"edit request that payment is to be
made by transfer to an account with us or at another bank, we and/or such other bank may rely on an account
number specified in such instructions even if the number ldentlfies a person or entity different from the Intended
payee.
This Letter of Credit expires at our above ofIIce on AprIl 30, 2009.
This Letter of Credit Is subject to the Uniform Customs and Practice For Documentary Credits (2007
Revision), International Chamber of Commerce Publication No. 600, and engages us In accordance therewith.
BY:
Very truly yours
MUSt~
EISA~<8R1ZED SlGNAlURE)
ASSIRTA.NT \iICE PRESIDENT