Okaloosa County BOCC — May 17, 2013 — Procurement Manual PROPOSED Transit Language 4-22-13 — reading text

execution. However, delivery of vehicles is allowed after this date, as long as the contract or options for these vehicles were executed within five years of the original agreement execution date. The five-year limitation does not apply to construction contracts or to leases of real property, (which period may extend beyond five years, as long as the BCC has “satisfactory continuing control over ownership of the property.”) Such lease agreements do not need prior approval of FTA. B. Payment Provisions In Contracts 1 Using Advance Payments The BCC will not enter into any contractual agreement to pay any or part of the payments prior to costs incurred by the contractor. 2 Using Progress Payments The two major types of progress payments are payments based on costs, and payments based on completion of work. FTA considers both types as contract financing methods. Instances in which the BCC may use progress payments in accordance with FTA guidelines are: ¾ When payments are only made to the contractor for costs incurred in the performance of the contract, and ¾ When the BCC is allowed to obtain title to property (materials, work in progress, and finished goods) for which progress payments are made. In lieu of obtaining a 17  FTA PROVISIONS, CERTIFICATIONS, REPORTS, FORMS AND OTHERS title, the BCC may require an irrevocable letter of credit or equivalent means to protect its interest. 3 Prompt Payment In accordance with 49 CFR 26.29, Participation by Disadvantaged Business Enterprises in Department of Transportation Financial Assistance Programs, grantees must have a contract clause that requires primes to pay subcontractors for satisfactory performance of their contract work no later than 30 days from receipt of payment for such work from the grantee. Grantees must ensure prompt and full payment of retainage from the prime contractor to the subcontractor within 30 days after the subcontractor's work is satisfactorily completed. Therefore, the BCC will use one of the following methods to comply with this requirement: • Decline withholding of retainage from prime contractors and prohibit prime contractors from holding retainage from subcontractors. • Decline withholding of retainage from prime contractors and require a contract clause obligating prime contractors to make prompt and full payment of any retainage kept by prime contractor to the subcontractor within 30 days after the subcontractor's work is satisfactorily completed. • Withhold retainage from prime contractors and provide for prompt and regular incremental acceptances of portions of the prime contract, pay retainage to prime contractors based on these acceptances, and require a contract retainage owed to the subcontractor for satisfactory completion of the accepted work within 30 days after your payment to the prime contractor. In the event the BCC decides to withhold payments on a contract, it will ensure that the amount of money withheld bears a reasonable relationship to the unsatisfactory work (e.g. the amount withheld will represent a reasonable estimate of the contractor’s potential liability). The amount withheld will not be so great however, such that it impairs the contractor’s ability to perform. 4 Final Payment Final payment will be made to the contractor when it has satisfied all of the deliverable requirements called for by all provisions of the contract, including all required documentation. Before making final payment, the BCC may obtain a signed release from the contractor releasing it from further claims by the contractor. XI. Specific Contract Types A. Revenue Contracts A revenue contract is any contract whose primary purpose is to either generate revenues in connection with a transit-related activity or to create business opportunities using an FTA-funded asset. Examples may include, advertising, concessions (food and news stands), use of right-of-ways, licenses, and land and property leasing. the BCC will adhere to the following conditions regarding such contracts: 18  FTA PROVISIONS, CERTIFICATIONS, REPORTS, FORMS AND OTHERS ¾ No contract award will be entered into for any period beyond 5 years, with the exception of land or property leases, which may be extended beyond 5 years (see reference above in section on Maximum Length of Service and/or Supply Contracts); ¾ the BCC will use competitive selection procedures for award of such contracts; and ¾ the BCC will not exclude Disadvantaged Business Enterprises (DBEs) from participating in business opportunities by entering into long-term, exclusive agreements with non-DBEs for the operation of major transportation-related activities or major activities for the provision of goods and services. B. Cost Plus Percentage Prohibited. The BCC will not contract using this method. The Common Grant Rules expressly prohibit the use of the cost plus a percentage of cost and cost plus a percentage of construction cost methods of contracting. C. Use of Time and Materials Type Contracts Restricted. The BCC will not contract using this method. The Common Grant Rule for governmental recipients permits the use of time and material contracts only: When to Use. After determining that no other contract type is suitable; and Firm Ceiling Price. If the contract specifies a ceiling price that the contractor may not exceed except at its own risk. XII. Performing Independent Cost Estimates; Cost and or Price Analyses A. Independent Cost Estimate An independent cost estimate (ICE) for all procurements shall occur for purchases $2,500.00 or more. The ICE is a tool to assist in the determination of the reasonableness or unreasonableness of a bid or proposal being evaluated. ICEs can range from a simple budgetary estimate to a complex estimate based on inspection of the product itself and review of items like drawings, specifications and prior data. The ICE is especially critical whenever there is no price competition (e.g., for architect-engineer procurements where only one price proposal is received), or where offerors are submitting price proposals for goods or services that are not exactly comparable (e.g., for procurements of high-technology items or professional services). It is also useful in competitive procurements to alert the agency when all competitors are submitting unreasonably high cost proposals. The County will conduct a cost or price analysis in connection with every Federal procurement action, including contract modifications. For small and micro purchases, refer to page 14, “G. Purchasing Procedures”. B. Profit The BCC will negotiate profit as a separate element of the price for each contract in which there is no price competition and in all cases where cost analysis is performed. To 19  FTA PROVISIONS, CERTIFICATIONS, REPORTS, FORMS AND OTHERS establish a fair and reasonable profit, consideration will be given to the complexity of the work to be performed, the risk borne by the contractor, the contractor’s investment, the amount of subcontracting, the quality of its record of past performance, and industry profit rates in the surrounding geographical area for similar work. C. Federal Cost Principles ¾ Cost Plus Percentage of Cost-For construction, this cost method of contracting will not be used. The BCC will make every effort to ensure that all cost estimates included in negotiated prices are consistent with Federal cost principles. In doing so, the BCC will reference past and current cost principles that comply with applicable Federal cost principles. D. Remedies for Breach of Contract ¾ Liquidated Damages-The BCC may include a liquidated damages provision to its contracts, the BCC will credit any liquidated damages recovered to the project, unless FTA permits other uses of the liquidated damages. The rate and measurement standards will be calculated to reasonably reflect the costs should the standards not be met, and will be specified in the contract. ¾ Violation of Breach-Contracts over $100,000 will include provisions for remedies for violations or breach of contract. ¾ Suspension of Work-At any time and without cause, the BCC may suspend any portion of work for a period of not more than 90 days by notice in writing. ¾ Termination-Work performed under a contract may be terminated in part or in whole pursuant to the termination provisions in the contract which may include termination for convenience or for default. Termination for cause and termination for convenience provisions must be included in contracts exceeding $10,000. E. Termination Cost Analysis Contracts can be terminated for the convenience of the BCC or for cause (also called default). Contracts are usually terminated for convenience when the BCC no longer has a need for the service or products as they are specified in the contract, or when it is possible to substantiate that the contractor's performance is poor enough to terminate for cause. Contracts should be terminated for cause when the contractor fails to perform the contract as written. XIII. Purchasing / Leasing Buses with FTA Funds (Bus Testing) To the extent applicable, the BCC agrees to comply with the requirements of 49 U.S.C. § 5323(c) and FTA regulations, “Bus Testing,” 49 C.F.R. Part 665, and any revision thereto, for buses purchased or leased with FTA funds. the BCC will certify to FTA that any new bus model required to be tested has been tested at the FTA-sponsored test facility in Altoona, Pennsylvania. 20  FTA PROVISIONS, CERTIFICATIONS, REPORTS, FORMS AND OTHERS A new bus model is a bus design variation of a bus design (usually designated by the manufacturer by a specific name and/or model number) that has not been in use in U.S. mass transit service prior to October 1, 1988, or that has been in service prior to that date, but is being procured with a major change in configuration or components. A new bus model must be tested. Bus testing requirements apply to different mass transit vehicles including vans, other small vehicles, medium-light-duty mid-size buses, and heavy-duty small and large buses. Bus testing does