Economic Development Administration Regulations; Revision To Implement the Economic Development Reform Act of 1998
Federal RegisterFeb 3, 1999
Ask Donna
What actually matters in this document.
Text
SUMMARY: The purpose of this interim-final rule is to revise
regulations of the Economic Development Administration (EDA) to
implement the comprehensive amendment to the Public Works and Economic
Development Act of 1965, as amended, by the Economic Development
Administration Reform Act of 1998 (Pub. L.105-393).
DATES: Effective date: February 11, 1999.
Comment date: Comments are due on or before April 5, 1999.
ADDRESSES: Send comments to Edward M. Levin, Chief Counsel, Economic
Development Administration, U.S. Department of Commerce, Herbert C.
Hoover Building, 1401 Constitution Avenue, NW, Room 7005, Washington,
DC 20230
FOR FURTHER INFORMATION CONTACT: Edward M. Levin, Chief Counsel,
Telephone Number 202-482-4687, fax 202-482-5671, and e-mail
EL[email protected].
SUPPLEMENTARY INFORMATION:
Background
The Economic Development Administration (EDA) was reauthorized for
a five-year period by legislation enacted on November 13, 1998.
Congress had not authorized the agency since 1982. This legislative
accomplishment will create stability and opportunities for EDA to
better serve economically distressed communities across the country.
EDA continues to take steps toward improving its program delivery,
policies and procedures, and to be more responsive to those whom it
serves. In step with the National Performance Review and Paperwork
Reduction Act, EDA had completely revised its regulations, thereby
creating fewer burdens on and making them more accessible to the
public. This interim-final rule continues EDA's efforts in this regard.
Description of Major Changes
This interim-final rule removes, adds, redesignates and revises
parts and sections of EDA's regulations at 13 CFR Chapter III to
implement Pub. L. 105-393 and to continue the streamlining and plain
language initiatives of this administration. Significant changes are
described below.
Removals of Parts and Sections
Certain parts and sections have been removed because the programs
to which these regulations apply were deleted by Pub. L. 105-393 as
follows: Part 302 Economic Development Districts, Subpart B--Standards
for Designation, Modification, and Termination of Economic Development
Centers and Subpart C, Financial and Other Assistance to Economic
Development Centers and Districts; part 312, Supplemental and Basic
Assistance Under Section 304 of the Act; references to and requirements
under the Public Works Impact Program in parts 301 and 305 and
Sec. 316.3; Sec. 305.10 Construction cost increases; Sec. 316.2
Certification as to waste treatment, and Sec. 316.5 Electric and gas
facilities.
Other parts and sections were removed to streamline and simplify
the rules such as: Sec. 302.1 Authorization of Economic Development
Districts, and Sec. 305.12 Variance in cost of grant projects.
New Parts and Sections
New parts and sections have been added to implement Pub. L. 105-393
as follows: Pursuant to sec. 302 of Pub. L. 105-393, new language has
been added in Secs. 301.3, 305.3 and 308.5 on requirements for
strategies for public works and economic adjustment projects (except
for planning); pursuant to sec. 601 of Pub. L. 105-393, with EDA's
prior written approval EDA may release its grant related property
interests 20 years after the grant award, and Sec. 314.11(b) releases
all real and personal property in projects funded under Pub. L. 94-369,
as amended by Pub. L. 95-28. Other sections have been added in light of
new provisions in Pub. L. 105-393, such as Sec. 316.13 Economic
development information clearinghouse, Sec. 316.17 Acceptance of
certifications by applicants, and Sec. 316.18 Reports by recipients,
and part 318 Evaluations of Economic Development Districts and
University Centers.
New parts of sections have been added for other reasons, for
example, Sec. 314.3(c) defines ``adequate consideration'' to
distinguish it from fair market value; and Sec. 314.7(c) provides
exceptions to the title requirement when for example, a railroad or
state or local highway is part of the EDA funded project.
Significant Revisions
Part 301--Designation of Areas has been substantially rewritten
because under Pub. L. 105-393 areas designated by EDA prior to the
effective date of Pub. L. 105-393 will no longer be so designated and
areas thereafter will be determined on a project by project basis (for
public works and economic adjustment projects, except for planning
activities); and Sec. 316.2 has been redesignated and substantially
changed to more accurately reflect statutory intent and practices and
procedures for determining if a project would result in excess
capacity.
Other significant changes--Grant rates have been modified at
Sec. 301.4 to cover all EDA grants (not just public works awards) and
to reflect changed unemployment conditions; and Sec. 308.3 has been
changed to revise area criteria for economic adjustment projects to
emphasize unique economic adjustment tools.
Note
EDA has recently established a task force to examine
its Revolving Loan Fund (RLF) program as described in part 308 of
these rules. The results of this task force may lead to changes in
EDA's RLF program.
An interest rate buy down program (see Sec. 308.3), is
being considered under EDA's Economic Adjustment program.
Suggestions on structuring and implementing such a program are
welcome.
As part of the economic development clearinghouse
described in Sec. 316.14, EDA's Office of Economic Development
Information is accessible on the internet web sites at http://
www.doc.gov/eda and http://netsite.esa.doc.gov/oeci.
Table of Changes
------------------------------------------------------------------------
Description of
Old section New section change
------------------------------------------------------------------------
Sec. 300.1................. Sec. 300.1......... Renamed and changed
for Plain Language
purposes.
[[Page 5349]]
Part 301--Designation of Part 301--General Renamed.
areas. eligibility and
grant rate
requirements.
Secs. 301.1-301.16......... .................... Removed since under
Pub. L. 105-393
there is no longer
area designation
except on a project-
by-project basis.
Secs. 301.1-301.4.. New Secs. include
information and
requirements about
applicants, area
eligibility,
strategy required
and grant rates.
Sec. 302.1................. .................... Removed.
Sec. 302.2................. Sec. 302.1......... Redesignated and
modified for Plain
Language purposes.
Sec. 302.3................. Sec. 302.2......... Redesignated and
modified for Plain
Language purposes.
Sec. 302.4................. Sec. 302.3......... Redesignated and
modified for Plain
Language purposes.
Sec. 302.5................. Sec. 302.4......... Redesignated and
modified for Plain
Language purposes.
Sec. 302.6................. Sec. 302.4......... Made part of this
new section.
Sec. 302.7................. Sec. 302.5......... Redesignated and
streamlined.
Sec. 302.8................. Sec. 302.6......... Redesignated,
modified and
streamlined.
Sec. 302.9................. Sec. 301.4(d)...... Redesignated,
terminology
modified, and
portions removed
since Economic
Development Centers
are no longer part
of PWEDA
Sec. 302.7......... New under Pub. L.
105-393.
Secs. 302.10-302.19........ .................... Removed since
Economic
Development Centers
are no longer part
of PWEDA.
Part 303--Overall Economic Part 303--Planning Renamed.
Development Program. Process and
Strategies for
District and Other
Planning
Organizations
Supported by EDA.
Sec. 303.1................. Sec. 303.1......... Renamed and modified
to add definitions
and streamlined.
Secs. 303.2, 303.3......... .................... Removed.
Secs. 303.4, 303.5, 303.6.. Secs. 303.2, 303.3. Renamed and revised
for Plain Language
purposes and
consistent with
Pub. L. 105-393.
Sec. 304.1................. Secs. 304.1, 304.2. Renamed and revised
to make more
accessible to
reader.
Sec. 304.2................. Secs. 307.11, Renamed and
307.14. redesignated to
implement Pub. L.
105-393.
Part 305--Public Works and .................... Part 305--Grants for
Development Facilities Public Works and
Program. Development
Facilities Renamed.
Sec. 305.2................. Sec. 300.2......... Renamed and
applicable to all
programs.
Sec. 305.3......... Application
requirements.
Secs. 305.3, 305.4......... Sec. 305.2......... Renamed, merged and
modified to
implement Pub. L.
105-393.
Secs. 305.5, 305.6......... Sec. 305.4......... Renamed, combined
and modified to
implement Pub. L.
105-393.
Sec. 305.7................. .................... Removed.
Secs. 305.8, 305.9......... Sec. 301.4......... Renamed and
applicable to all
programs.
Sec. 305.10................ .................... Removed.
Sec. 305.11................ Sec. 305.5......... Redesignated and
revised to make
more accessible to
reader.
Sec. 305.12................ .................... Removed.
Sec. 305.13................ Sec. 305.6......... Redesignated.
Sec. 305.7......... Added for guidelines
and reports.
Part 306 [Reserved]; Part Part 306--Planning Renamed and revised
307--Local Technical Assistance. under Pub. L. 105-
Assistance, University 393 and for Plain
Center Technical Language purposes.
Assistance, National
Technical Assistance,
Research and Evaluation and
Planning--Subpart E--
Economic Development
Districts American Indian
Tribes and Redevelopment
Areas Economic Development
Planning Grants and Subpart
F--State and Urban
Development Planning Grants.
Part 307--Local Technical Part 307--Local Renamed consistent
Assistance, University Technical with Pub. L. 105-
Center Technical Assistance, 393.
Assistance, National University Center
Technical Assistance, Technical
Research and Evaluation and Assistance,
Planning. National Technical
Assistance,
Training, Research
and Evaluation.
Sec. 307.2................. Sec. 300.2......... Redesignated to
apply to all
programs and this
program in
particular.
Secs. 307.3, 307.4......... Sec. 307.2......... Renamed, merged and
revised to make
more accessible to
reader.
[[Page 5350]]
Sec. 307.5................. Sec. 307.3......... Renamed,
redesignated and
revised to make
more accessible to
reader and in
accordance with
Pub. L. 105-393.
Sec. 307.6................. Sec. 307.4......... Redesignated.
Sec. 307.7................. Sec. 300.2......... Redesignated to
apply to all
programs and this
program in
particular.
Secs. 307.8, 307.9......... Sec. 307.5......... Renamed, merged and
revised to make
more accessible to
reader.
Sec. 307.10................ Sec. 307.6......... Renamed,
redesignated and
revised to make
more accessible to
reader and in
accordance with
Pub. L. 105-393.
Subpart C--National Subpart C--National Renamed, merged and
Technical Assistance, Technical redesignated to be
Subpart D--Research and Assistance, consistent with
Evaluation. Training, Research, Pub. L. 105-393.
and Evaluation.
Secs. 307.11, 307.16....... Sec. 307.7......... Redesignated, merged
and revised to make
more accessible to
reader.
Secs. 307.12, 307.17....... Sec. 300.2......... Renamed and merged
as applicable to
all programs and to
this program in
particular.
Secs. 307.13, 307.14, Sec. 307.8......... Renamed, merged and
307.18, 307.19. revised to make
more accessible to
reader.
Secs. 307.15, 307.21....... Sec. 307.9......... Renamed, revised and
modified for Plain
Language purposes.
Sec. 307.20................ .................... Removed--will be in
Notice(s) of
Funding
Availability--Reque
st for Proposals.
Secs. 307.22............... Sec. 306.1......... Redesignated, merged
and revised
consistent with
Pub. L. 105-393.
Sec. 307.23................ .................... Removed.
Secs. 307.24, 307.30....... Sec. 300.2......... Applicable to all
programs.
Secs. 307.25, 307.26, Sec. 306.2......... Renamed, merged,
307.31, 307.32. streamlined and
modified for Plain
Language purposes.
Secs. 307.27, 307.33....... Secs. 306.3, 306.4. Redesignated and
made consistent
with Pub. L. 105-
393.
Sec. 307.28................ Sec. 302.3......... Part of new
provision on
District
Organizations.
Part 308--Requirements for Part 308-- Renamed consistent
Grants Under the Title IX Requirements for with Pub. L. 105-
Economic Adjustment Program. Economic Adjustment 393.
Grants.
Sec. 308.2................. Sec. 308.3......... Renamed and revised
to make more
accessible to
reader.
Sec. 308.3................. Secs. 308.5, 300.2. Renamed and revised
to be more
accessible to
readers and
applicable to all
programs.
Sec. 308.4................. Sec. 308.2......... Renamed and revised
for consistency
with Pub. L. 105-
393.
Secs. 308.5, 308.6......... Sec. 308.4......... Renamed, merged and
modified to
implement Pub. L.
105-393 and to be
more accessible to
readers.
Sec. 308.7................. Sec. 308.6......... Renamed and
streamlined.
Part 312--Supplemental and Section 304 of the Removed as no longer
Basic Assistance Under. Act. in effect.
Part 314--Property.......... Part 314--Property Renamed.
Management
Standards.
Sec. 314.9................. Sec. 314.9......... Renamed and expanded
to refer to title
requirements.
Subpart D--Release Added to implement
of EDA's Property provision of Pub.
Interest. L. 105-393 and to
clarify EDA's
property release
requirements.
Sec. 316.2................. .................... Removed as no longer
in effect.
Sec. 316.3................. Sec. 316.2......... Redesignated and
clarified.
Sec. 316.4................. Sec. 316.3......... Redesignated.
Sec. 316.5................. .................... Removed as no longer
in effect.
Sec. 316.6................. Sec. 316.4......... Redesignated.
Sec. 316.7................. Sec. 316.5......... Redesignated.
Sec. 316.8................. Sec. 316.6......... Redesignated.
Sec. 316.9................. Sec. 316.7......... Redesignated.
Sec. 316.10................ Sec. 316.8......... Redesignated and
clarified.
Sec. 316.11................ Sec. 316.9......... Redesignated.
Sec. 316.12................ .................... Removed as included
in Sec. 316.8.
Sec. 316.13................ Sec. 316.10........ Renamed and
modified.
Secs. 316.11-316.18 Added to implement
provisions of Pub.
L. 105-393.
Sec. 316.19........ Added to replace
current procedures
and requirements.
Part 318-- Added to implement
Evaluations of provisions of Pub.
Economic L. 105-393.
Development
Districts and
University Centers.
------------------------------------------------------------------------
[[Page 5351]]
Savings Clause
The rights, duties, and obligations of all the parties pursuant to
parts, sections and portions thereof of the Code of Federal Regulations
removed by this rule shall continue in effect, except that EDA may
waive administrative or procedural requirements of provisions removed
by this rule.
Executive Orders 12866 and 12875
This rule has been determined to be significant for the purposes of
E.O. 12866, Regulatory Planning and Review. In addition, it has been
determined that, consistent with the requirements of E.O. 12875,
Enhancing Intergovernmental Partnership, this interim final rule will
not impose any unfunded mandates upon State, local, and tribal
governments.
Notice and Comment
This rule is not subject to the rulemaking requirements of 5 U.S.C.
553 because it relates to public property, loans, grants, benefits, and
contracts, 5 U.S.C. 553(c)(2), including the provision of prior notice
and an opportunity for public comment and delayed effective date.
No other law requires that notice and opportunity for comments be
given for this rule.
However, because the Department is interested in receiving comments
from those who will benefit from the amendments, this rule is being
issued as interim final. Public comments on the interim final rule are
invited and should be sent to the address or numbers listed in the
ADDRESSES and FOR FURTHER INFORMATION CONTACT sections above. Comments
received by April 5, 1999 will be considered in promulgating a final
rule.
Note: EDA is particularly interested in comments relating to its
use of Plain Language in order to make these requirements more
readily accessible to the public.
Regulatory Flexibility Act
Since notice and an opportunity for comment are not required to be
given for the rule under 5 U.S.C. 553 or any other law, under sections
603(a) and 604(a) of the Regulatory Flexibility Act (5 U.S.C. 601-612)
no initial or final Regulatory Flexibility Analysis is required, and
none has been prepared.
Paperwork Reduction Act
This regulation imposes new information collection or recordkeeping
requirements under the Paperwork Reduction Act of 1980 (44 U.S.C.
3501), as amended, but has been cleared under OMB's Emergency
Clearances process under OMB approval numbers: 0610-0093; 0610-0094;
0610-0095; 0610-0096 and will expire on July 31, 1999. To remain
effective after such expiration date, EDA must receive OMB's final
clearance and display a currently valid OMB control number. If such
final clearance is not obtained after the expiration date of the
Emergency Clearance so that a currently valid OMB control number is not
displayed, applicants and recipients will not thereafter be required to
submit information requested pursuant to this rule.
The information is needed to determine eligibility of those
applicants and projects and to monitor projects for compliance with
EDA's construction or Revolving Loan Fund requirements, as applicable.
EDA then uses information obtained in these collections to help carry
out its mission to aid economically distressed areas of the Nation.
Responses to requests for information are necessary under Pub. Law 105-
393 for obtaining and for keeping benefits. The reporting burden for
this collection is estimated to be approximately 7 burden hours for the
Proposal; approximately 50 burden hours for the Application;
approximately 18 burden hours for Requirements for Approved
Construction Projects; approximately 240 burden hours for the CED
Strategy Guidelines; and approximately 76 burden hours for the series
of Guidelines for the Revolving Loan program, including the time for
gathering and maintaining the data needed for completing and reviewing
the collection of information. Comments are invited on: (a) whether the
collection of information is necessary for the proper performance of
the functions of the agency, including whether the information shall
have practical utility; (b) the accuracy of the agency's estimate of
the burden of the proposed collection of information; (c) ways to
enhance the quality, utility, and clarity of the information to be
collected; and (d) ways to minimize the burden of the collection of
information on respondents, including through the use of automated
collection techniques or other forms of information technology.
Comments regarding these burden estimates or any other aspects of the
collection of information, including suggestions for reducing the
burdens, should be forwarded to Edward M. Levin, Chief Counsel,
Economic Development Administration, U.S. Department of Commerce,
Herbert C. Hoover Building, 1401 Constitution Avenue, NW, Room 7005,
Washington, DC 20230 and to the Office of Information and Regulatory
Affairs, Office of Management and Budget, Washington, DC 20503
(Attention EDA Desk Officer).
Administrative Procedure Act and Regulatory Flexibility Act
Executive Order 12612 (Federalism Assessment)
This action has been reviewed in accordance with the principles and
criteria contained in E.O. 12612. It has been determined that this
interim final rule does not have significant Federalism implications to
warrant a full Federalism Assessment under the principles and criteria
contained in E.O. 12612.
List of Subjects
13 CFR Part 300
Reporting and recordkeeping requirements; Non-profit organizations;
American Indians.
13 CFR Part 301
Grant Programs; Community Development; American Indians.
13 CFR Part 302
Community Development; Grant programs-community development;
Technical assistance.
13 CFR Part 303
Community Development; Grant programs-community development.
13 CFR Part 304
Selection and evaluation.
13 CFR Part 305
Community development; Community facilities; Grant programs-
community development.
13 CFR Part 306
Community development; Grant programs-community development.
13 CFR Part 307
Business and industry; Community development; Community facilities;
Grant programs-business; Grant programs-community development;
Research; Technical Assistance.
13 CFR Part 308
Business and industry; Community development; Community facilities;
Grant programs-business; Grant programs-community development; American
Indians; Manpower training programs; Mortgages; Research; Technical
assistance.
[[Page 5352]]
13 CFR Part 314
Community development; Grant programs-community development.
13 CFR Part 315
Administrative practice and procedure; Community development; Grant
programs-business; Technical assistance; Trade adjustment assistance.
13 CFR Part 316
Community development; Grant programs-community development;
Freedom of Information; Uniform Relocation Act; Loan programs-business;
Loan programs-community development; Environmental protection; Record
retention; Records.
13 CFR Part 317
Civil rights; sex discrimination.
13 CFR Part 318
Colleges and universities.
For the reasons set forth in the preamble, 13 CFR Chapter III is
revised to read as follows:
CHAPTER III--DEPARTMENT OF COMMERCE, ECONOMIC DEVELOPMENT
ADMINISTRATION
Part
300 General Information.
301 General Eligibility and Grant Rate Requirements.
302 Economic Development Districts; standards for designation,
modification and termination.
303 Planning Process and Strategies for District and Other Planning
Organizations Supported by EDA.
304 General Selection Process and Evaluation Criteria.
305 Grants for Public Works and Development Facilities.
306 Planning Assistance.
307 Local Technical Assistance, University Center Technical
Assistance, National Technical Assistance, Training, Research, and
Evaluation.
308 Requirements for Economic Adjustment Grants.
309-313 [Reserved].
314 Property.
315 Certification and Adjustment Assistance for Firms.
316 General Requirements for Financial Assistance.
317 Civil Rights.
318 Evaluations of University Centers and Economic Development
Districts.
PART 300--GENERAL INFORMATION
Sec.
300.1 Introduction and purpose.
300.2 Definitions.
300.3 OMB control numbers.
300.4 Economic Development Administration--Washington, DC, Regional
and Economic Development Representatives.
Authority: 42 U.S.C. 3211; Department of Commerce Organization
Order 10-4.
Sec. 300.1 Introduction and Purpose.
(a) Introduction. Is your community suffering from severe economic
distress (e.g., high unemployment, low income, sudden economic changes,
etc.)? Are you a representative of a State or local unit of government,
Indian tribe, public or private nonprofit organization, educational
institution, or community development corporation looking for grant
assistance to enhance your opportunities for economic development? If
so, these regulations of the Economic Development Administration (EDA)
of the U.S. Department of Commerce may be of help. These regulations
tell you the purpose of EDA and outline the program requirements,
project selection process, project evaluation criteria, and other
relevant matters. The information in these regulations covers grant
programs of EDA that provide financial awards for the following:
Public Works and Development Facilities;
Planning;
Research, Evaluation, Training and Technical
Assistance;
Trade Adjustment Assistance; and
Economic Adjustment Assistance.
(b) What is the Purpose of the Economic Development Administration?
(1) Many communities lag behind and suffer economic distress in one
form or another, such as:
High unemployment;
Low income;
Underemployment;
Outmigration;
Sudden economic changes due to the restructuring or
relocation of industrial firms;
Closing or realignment of defense bases or cutbacks in
defense procurement;
Economic impact of natural disasters or other
emergencies;
Actions of the Federal government (such as
environmental requirements) that curtail or remove economic
activities; and
Impacts of foreign trade.
(2) The purpose of the Economic Development Administration is to
address economic problems affecting economically distressed rural and
urban communities; by helping them:
(i) Develop and strengthen their economic development planning and
institutional capacity to design and implement business outreach and
development programs; and
(ii) Develop or expand public works and other facilities, financing
tools, and resources that will create new job opportunities, save
existing jobs, retain existing businesses, and support the development
of new businesses.
(3) To promote a strong and growing economy throughout the United
States, EDA works in partnership with State and local governments,
Indian tribes and local, regional, and State public and private
nonprofit organizations. With them EDA develops and carries out
comprehensive economic development strategies that address the economic
problems of distressed communities. EDA helps such communities increase
their economic development capacities so that they can take advantage
of existing resources and development opportunities.
Sec. 300.2 Definitions.
Unless otherwise defined in other parts or sections of this
Chapter, the terms listed are defined as follows:
Comprehensive Economic Development Strategy, CED Strategy, or
strategy means a strategy approved by EDA under Sec. 301.3 of these
regulations.
Department means the Department of Commerce.
Economic Development District or district:
(1) Means any area in the United States that has been designated by
EDA as an Economic Development District under Sec. 302.1 of these
regulations; and
(2) Includes any Economic Development District designated by EDA
under sec. 403 of the Public Works and Economic Development Act of
1965, as amended, as in effect on the day before the effective date of
Public Law 105-393.
EDA means the Economic Development Administration in the U.S.
Department of Commerce when a place or agency is intended, and refers
to the headquarters office in Washington, D.C., or a regional office,
as appropriate; or it means the Assistant Secretary of Commerce for
Economic Development or his/her designee when a person is intended. The
locations of EDA's offices are listed each year in a Notice of Funding
Availability (NOFA). The general information telephone number for EDA
is (202) 482-2309.
Eligible applicant means:
(1) In general,--
(i) An entity qualified to be an eligible recipient, or
(ii) Its authorized representative.
(2) Except in the case of Research, Evaluation, Training, or
Technical Assistance grants under part 307, a private individual or
for-profit organization cannot be an eligible applicant.
Eligible recipient means
(1) In general,--
(i) An area described in Sec. 301.2 of these regulations;
(ii) An Economic Development District;
(iii) An Indian tribe or a consortium of Indian tribes;
[[Page 5353]]
(iv) A State;
(v) A city or other political subdivision of a State or a
consortium of political subdivisions;
(vi) An institution of higher education or a consortium of
institutions of higher education; or
(vii) A public or private nonprofit organization or association
acting in cooperation with officials of a political subdivision of a
State.
(2) In the case of Research, Evaluation, Training, and Technical
Assistance grants under part 307, eligible recipient also includes
private individuals and for-profit organizations.
Federal agency means a department, agency, or instrumentality of
the United States.
Financial assistance means grant.
Grant means the non-procurement award of EDA funds to an eligible
recipient under PWEDA or the Trade Act, as applicable. The term
includes a cooperative agreement, within the meaning of chapter 63 of
title 31, United States Code.
Indian tribe means any Indian tribe, band, nation, pueblo, or other
organized group or community, including any Alaska Native Village or
Regional Corporation (as defined in or established under the Alaska
Native Claims Settlement Act (43 U.S.C. 1601 et seq.)), that is
recognized as eligible for the special programs and services provided
by the United States to Indians because of their status as Indians. The
term includes: The governing body of a tribe, nonprofit Indian
corporation (restricted to Indians), Indian authority, or other
nonprofit tribal organization or entity, provided that the tribal
organization or entity is wholly owned by, and established for the
benefit of, the tribe or Alaska Native Village.
Local share, matching share or local share match are used
interchangeably to mean non-Federal funds or goods and services
provided by recipients or third parties that are required as a
condition of a grant, and includes funds from other Federal agencies
only if there is statutory authority allowing such use.
Notice of Funding Availability or NOFA, refers to the notice or
notices EDA publishes each year in the Federal Register and on EDA's
internet web site, http://www.doc.gov/eda, describing the available
amounts, particular procedures, priorities, and special circumstances
for the EDA grant programs for that year.
OEDP (Overall Economic Development Program), as the term is used in
part 317 (Civil Rights) of this chapter, means CED Strategy developed
in accordance with part 303 of this chapter.
PWEDA means the Public Works and Economic Development Act of 1965,
as amended (Pub. L. 89-136, 42 U.S.C. 3121 et seq.), including the
comprehensive amendments by the Economic Development Administration
Reform Act of 1998 (Pub. L. 105-393). (The term ``PWEDA'' was used to
refer to EDA's authorizing legislation as it was in effect before the
effective date of Public Law 105-393, signed into law on November 13,
1998. In these regulations, the term ``PWEDA'' refers to the
legislation as currently amended by the 1998 law.)
Project means the activity or activities the purpose of which
fulfills EDA program requirements and that EDA funds in whole or in
part.
Proposed District means a geographic entity composed of one or more
eligible areas proposed for designation as an Economic Development
District.
Recipient and grantee are used interchangeably to mean an entity
receiving funds from EDA under PWEDA or the Trade Act, as applicable,
and includes any EDA approved successor to such recipient.
State means a State, the District of Columbia, the Commonwealth of
Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, the
Commonwealth of the Northern Mariana Islands, the Republic of the
Marshall Islands, the Federated States of Micronesia, and the Republic
of Palau.
The Trade Act means Title II, Chapters 3 and 5, of the Trade Act of
1974, as amended (19 U.S.C. 2341, et seq.).
United States means all of the States.
Sec. 300.3 OMB Control Numbers.
(a) This table displays control numbers assigned to EDA's
information collection requirements by the Office of Management and
Budget (``OMB'') pursuant to the Paperwork Reduction Act of 1980, Pub.
L. 96-511. EDA intends that this table comply with Section 3507(f) of
the Paperwork Reduction Act, requiring agencies to display a current
control number assigned by the Director of OMB for each agency
information collection requirement.
(b) Control Number Table:
------------------------------------------------------------------------
13 CFR part or section where identified
and described Current OMB control No.
------------------------------------------------------------------------
301....................................... 0610-0094.
302....................................... 0610-0094.
303....................................... 0610-0093.
304....................................... 0610-0094.
305....................................... 0610-0094 and 0610-0096.
306....................................... 0610-0094.
307....................................... 0610-0094.
308....................................... 0610-0094 and 0610-0095.
314....................................... 0610-0094.
315....................................... 0610-0094.
316....................................... 0610-0094.
------------------------------------------------------------------------
Sec. 300.4 Economic Development Administration-Washington, D.C.,
Regional and Economic Development Representatives.
For addresses and phone numbers of the Economic Development
Administration in Washington, D.C., Regional and Field Offices and
Economic Development Representatives, refer to EDA's annual Fiscal Year
(FY) Notice of Funding Availability (NOFA).
PART 301--GENERAL ELIGIBILITY AND GRANT RATE REQUIREMENTS
Sec.
301.1 Applicants.
301.2 Area eligibility.
301.3 Strategy required.
301.4 Grant rates.
Authority: 42 U.S.C. 3211; Department of Commerce Organization
Order 10-4.
Sec. 301.1 Applicants.
(a) Eligible applicants are defined in Sec. 300.2 of this chapter.
(b) Except as otherwise provided in part 307, a public or private
nonprofit organization applicant must include in its application for
assistance, a resolution passed by, or a letter signed by an authorized
representative of, a political subdivision of a State or an Indian
tribe, acknowledging that the applicant is acting in cooperation with
officials of the political subdivision or Indian tribe, as applicable.
Sec. 301.2 Area eligibility.
(a) EDA awards public works and development facilities grants under
part 305 and economic adjustment grants under part 308 for projects to
enhance economic development in economically distressed areas.
(b) An area is eligible for a project grant under part 305 or 308
if it has one of the following:
(1) An unemployment rate that is, for the most recent 24-month
period for which data are available, at least one percent greater than
the national average unemployment rate. For example, if the national
average unemployment rate is 6 percent, an area is eligible under this
provision if it has an unemployment rate of 7 percent.
(2) Per capita income that is, for the most recent period for which
data are
[[Page 5354]]
available, 80 percent or less of the national average per capita
income.
(3) A special need, as determined by EDA, arising from actual or
threatened severe unemployment or economic adjustment problems
resulting from severe short-term or long-term changes in economic
conditions, for example:
(i) Substantial outmigration or population loss;
(ii) Underemployment, that is, employment of workers at less than
full time or at less skilled tasks than their training or abilities
permit;
(iii) Military base closures or realignments, defense contractor
reductions-in-force, or Department of Energy defense-related funding
reductions;
(iv) Natural or other major disasters or emergencies;
(v) Extraordinary depletion of natural resources;
(vi) Closure or restructuring of industrial firms, essential to
area economies; or
(vii) Destructive impacts of foreign trade.
(c) A non-distressed area [i.e., an area that does not meet the
criteria of paragraph (b) of this section] within an Economic
Development District is also eligible, provided the project will be of
a substantial direct benefit to an area that meets at least one of the
criteria of paragraph (b) of this section. A project provides
substantial direct benefit if it provides significant employment
opportunities for unemployed, underemployed or low income residents.
(d) Normally an area is defined by geographical/political
boundaries, e.g., city, county, Indian reservation. However, a smaller
area (without regard to political boundaries) is also eligible even
though it may be part of a larger community that overall is
experiencing low distress. When the boundaries of the project area
differ from established political boundaries, the project area must be
of sufficient size appropriate to the proposed project, and the
applicant must justify the proposed boundaries in relation to the
project's benefits to the area.
(e) Eligibility is determined at the time that EDA receives an
application and is based on the most recent Federal data available for
the area where the project will be located or where the substantial
direct benefits will be received. If no Federal data are available to
determine eligibility, an applicant must submit to EDA the most recent
data available through the government of the State in which the area is
located.
(f) EDA may reject any documentation of eligibility that it
determines is inaccurate.
(g) There is no area eligibility requirement for a project grant
under part 306 or 307.
(h) EDA will describe special needs criteria under paragraph (b)(3)
of this section in a NOFA.
Sec. 301.3 Strategy Required.
(a) To be eligible for a project grant under part 305 or 308, the
application for assistance must include a CED Strategy acceptable to
EDA. The applicant may, however, incorporate by reference a current
strategy previously approved by EDA, as an alternative to including the
strategy in the application. (Exception: A strategy is not required
when a funding request is for planning assistance, i.e., a strategy
grant, under part 308.) The strategy must:
(1) Be the result of a continuing economic development planning
process;
(2) Identify the economic development problems to be addressed
using the assistance;
(3) Identify past, present, and projected future economic
development investments in the area receiving the assistance;
(4) Identify the public and private participants in the investments
and the sources of the funding for them;
(5) Describe how the problems identified under paragraph (a) (2) of
this section will be addressed, in a manner that promotes economic
development and opportunity, fosters effective transportation access,
enhances and protects the environment, and balances resources through
sound management of development; and
(6) Describe how the activities described under paragraph (a) (5)
of this section will contribute to the solution of the problems.
(b) EDA will approve as acceptable a strategy that it determines
meets the requirements of paragraph (a) of this section. The strategy
may be one developed:
(1) With EDA assistance,
(2) Under another Federally supported program, or
(3) Through a local, regional, or State process.
(c) In determining acceptability of a strategy, EDA will take into
consideration the circumstances of the application, so that for
instance a strategy accompanying an application for assistance
immediately following a natural disaster will require less depth and
detail than would be the case in other circumstances.
(d) To be acceptable, a strategy must be approved by the
applicant's governing body within one year prior to the date of
application.
Sec. 301.4 Grant Rates.
(a) Except as otherwise provided for in this chapter, the amount of
the EDA grant may not exceed 50 percent of the cost of the project.
Cash or in-kind contributions, fairly evaluated by EDA, including
contributions of space, equipment, and services, may provide the non-
Federal share of the project cost. In-kind contributions must be
eligible project costs and meet applicable Federal cost principles and
uniform administrative requirements.
(b) EDA may supplement the Federal share of a grant project where
the applicant is able to demonstrate that the non-Federal share that
would otherwise be required cannot be provided because of the overall
economic situation. It is not necessary for an applicant to prove that
it would be impossible to provide a full 50 percent non-Federal share,
but it must show circumstances warranting any reduction. In determining
whether to provide a Federal share greater than 50 percent for a
project, EDA will give due consideration to the applicant's economic
situation and the relative needs of the area. In the case of Indian
tribes, EDA may reduce or waive the non-Federal share, and in other
cases EDA may reduce the non-Federal share of the cost of the project
below 50 percent, in accordance with the following table, showing the
maximum Federal grant rate, including the supplement:
------------------------------------------------------------------------
Maximum grant
Projects rates
(percentage)
------------------------------------------------------------------------
Projects of Indian tribes where EDA has made a
determination to waive the non-Federal share of the
cost of the project.................................... 100
Projects located in Federally-declared disaster areas
for which EDA receives an application for assistance
within one year of the date of declaration, and for
which the President established a rate of Federal
participation, based on the public assistance grant
rate of the Federal Emergency Management Agency (FEMA)
for the disaster, of greater than 80 percent........... 100
Projects of Indian tribes where EDA has made a
determination to reduce the non-Federal share of the
cost of the project.................................... (1)
[[Page 5355]]
Projects of States or political subdivisions of States
that have exhausted their effective taxing and/or
borrowing capacity, or nonprofit organizations that
have exhausted their borrowing capacity................ (1)
Projects located in Federally-declared disaster areas
for which EDA receives an application for assistance
within one year of the date of declaration, unless the
applicant or the area is otherwise eligible for a
higher rate of Federal participation under another
provision of this section.............................. 80
Projects located in eligible areas where: (1) the 24-
month unemployment rate is at least 11 percent and is
at least 225% of the national average or (2) the per
capita income (PCI) is not more than 50% of the
national average....................................... 80
Projects located in eligible areas that are not eligible
for a higher rate, where: (1) the 24-month unemployment
rate is at least 9 percent and is at least 180% of the
national average or (2) the PCI is not more than 60% of
the national average................................... 70
Projects located in eligible areas that are not eligible
for a higher rate, where: (1) the 24-month unemployment
rate is at least 7.5 percent and is at least 150% of
the national average or (2) the PCI is not more than
70% of the national average............................ 60
Projects in all other eligible areas.................... 50
------------------------------------------------------------------------
\1\ Less than 100.
(c) Projects under part 306 or 307 are eligible for maximum grant
rates as provided in those parts.
(d) Projects located in designated Economic Development Districts
are eligible for an amount of additional Federal grant assistance not
to exceed 10 percent of the estimated cost of the project, provided
(1) The project applicant is actively participating in the economic
development activities of the district;
(2) The project is consistent with the strategy of the district;
and
(3) The non-Federal share of the project is not less than 20
percent.
(e) EDA may make grants to supplement grants awarded in other
Federal grant programs.
(1) Supplemental grants under paragraph (e) of this section are
only available for projects:
(i) Under Federal grant programs that
(A) Provide assistance in the construction or equipping of public
works, public service, or development facilities, and
(B) Are designated by EDA as eligible for supplemental EDA grants,
and
(ii) Are consistent with a strategy.
(2) EDA's funds combined with funds from another Federal grant
program may be at the maximum EDA grant rate, as set forth above, even
if the other Federal program has a lower grant rate. If the other
Federal program has a grant rate higher than the maximum EDA grant rate
as set forth above, the combination of funds may exceed the EDA rate
provided the EDA share does not exceed the EDA rate.
(f) An applicant is eligible for the highest applicable maximum
grant rate, as set forth above, in effect between the time EDA invites
the application and the time the project is approved. The Federal share
of a project receiving EDA grant assistance may be (and often is) less
than the maximum grant rate for which the recipient is eligible.
(g) EDA's NOFA will provide additional criteria to ensure that the
level of economic distress of an area, rather than a preference for a
geographic area or a specific type of economic distress, is the primary
factor in allocating assistance.
PART 302--ECONOMIC DEVELOPMENT DISTRICTS; STANDARDS FOR
DESIGNATION, MODIFICATION AND TERMINATION
Sec.
302.1 Designation of economic development districts.
302.2 Designation of nonfunded districts.
302.3 District organizations.
302.4 District organization functions and responsibilities.
302.5 Modification of district boundaries.
302.6 Termination and suspension of district designation.
302.7 Eligibility of non-distressed areas.
Authority: 42 U.S.C. 3211; Department of Commerce Organization
Order 10-4.
Sec. 302.1 Designation of Economic Development Districts.
EDA will designate a proposed district as an Economic Development
District with the concurrence of the State or States in which the
District will be wholly or partially located, when the proposed
district meets the following requirements:
(a) It is of sufficient size or population, and contains sufficient
resources, to foster economic development on a scale involving more
than a single eligible area;
(b) It has an EDA approved strategy which:
(1) Contains a specific program for intra-district cooperation,
self-help, and public investment;
(2) Is approved by each affected State;
(3) Identifies problems, and conditions underlying economic
distress in the district; and
(4) Promotes economic development opportunities, plans for
transportation access, enhancement and protection of the environment
and balances resources through sound management of development;
(c) It contains at least one area, eligible for assistance under
Sec. 301.2, that has been identified in an approved strategy;
(d) At least a majority of the counties, or other areas as
determined by EDA, within the proposed district boundaries have
submitted documentation of their commitment to support the economic
development activities of the district;
(e) A district organization has been established in the proposed
district which meets the requirements of Sec. 302.4; and
(f) The proposed district organization requests such designation.
Sec. 302.2 Designation of nonfunded districts.
The continuing designation of any Economic Development District is
subject to the criteria and organization requirements of this part
whether or not the Economic Development District organization receives
any EDA financial assistance.
Sec. 302.3 District organizations.
(a) The district shall be organized in one of the following ways:
(1) As a public organization through an intergovernmental agreement
for the joint exercise of local government powers; or
(2) As a public organization established under State enabling
legislation for the creation of multi-jurisdictional area wide planning
organizations; or
(3) As a non-profit organization incorporated under the laws of the
State in which it is located.
(b) Each district organization must meet EDA requirements
concerning membership composition [Sec. 302.3(c)], the maintenance of
adequate staff support to perform its economic development functions
[Sec. 302.3(d)], and its authorities and responsibilities for
[[Page 5356]]
carrying out economic development functions [Sec. 302.4]. Such
requirements must also be met by the board of directors (or other
governing body of the organization) as a whole.
(c) The district organization shall demonstrate that its governing
body meets all of the following requirements:
(1) It is broadly representative of the principal economic
interests of the district area including the interests of its minority
and low-income populations;
(2) There is at least a simple majority of its membership who are
elected officials and/or employees of a general purpose unit of local
government who have been appointed to represent the government; and
(3) At least 20 percent of its membership who are private citizens,
i.e., neither elected officials of a general purpose unit of local
government nor employees of such a government who have been appointed
to represent that government.
(d) The district organization shall be assisted by a professional
staff drawn from qualified persons in economic development, planning or
related disciplines. EDA may provide planning grants to Economic
Development Districts to employ professional staff in accordance with
part 306 of this chapter.
(e) The governing bodies of district organizations shall provide
access for persons who are not members to make their views known
concerning ongoing and proposed district activities in accordance with
the following requirements:
(1) The economic development district organization must hold
meetings open to the public at least once a year and shall also publish
the date and agenda of the meeting enough in advance to allow the
public a reasonable time to prepare to participate effectively.
(2) The district organization shall adopt a system of parliamentary
procedures to assure that board members and others have access to and
an effective opportunity to participate in the affairs of the district.
(3) Information should be provided sufficiently in advance of
public decisions to give the public adequate opportunity to review and
react to proposals. District organizations should seek to relate
technical data and other material to the public so they may understand
the impact of public programs, available options and alternative
decisions.
Sec. 302.4 District organization functions and responsibilities.
(a) All Economic Development District organizations are responsible
for seeing that the following are provided on a continuing basis,
consistent with the requirements of Sec. 302.3:
(1) Organizational actions, including:
(i) Arranging the legal form of organization which will be used;
(ii) Arranging for the membership of the governing body to meet
Sec. 302.3 requirements;
(iii) Recruiting staff to carry out the economic development
functions;
(iv) Establishing a management system;
(v) Contracting for services to carry out district functions;
(vi) Establishing and directing activities of economic development
subcommittees; and
(vii) Submitting reports as determined by EDA to comply with civil
rights requirements under part 317 of this chapter.
(2) Actions to develop and maintain the required district strategy,
and any subsequent supplements or revisions, including:
(i) Preparing the analytic, strategic and implementation components
of the strategy;
(ii) Adopting the strategy by formal action of the Economic
Development District governing board;
(iii) Submitting the strategy, any supplements or revisions and
annual reports for reviews by appropriate governmental bodies and
interested organized groups, and attaching dissenting opinions and
comments received; and
(iv) Submitting to EDA an approvable strategy.
(b) Organizations receiving EDA financial assistance for the
development and implementation of Comprehensive Economic Development
Strategies must also:
(1) Coordinate and implement economic development activities in the
district, including:
(i) Assisting other eligible units within the district to apply for
grant assistance for economic development purposes;
(ii) Carrying out economic development related research, planning,
implementation and advisory functions as are necessary to the
development and implementation of the strategy;
(2) Coordinate the development and implementation of the strategy
with other local, State, Federal and private organizations (including
minority organizations);
(3) Carry out the annual strategy for implementation; and
(4) Comply with the requirement of part 303.
Sec. 302.5 Modification of district boundaries.
EDA, at the request of a district and with concurrence of the State
or States affected (unless such concurrence is waived by the Assistant
Secretary), may modify the boundaries of a district, if it determines
that such modification will contribute to a more effective program for
economic development.
Sec. 302.6 Termination and suspension of district designation.
EDA may, upon 30 days prior written notice, terminate the
designation status of an Economic Development District:
(a) When the district no longer meets the standards for designation
as set forth above;
(b) When a district has not maintained a currently approved
strategy in accordance with part 303 of this chapter; or
(c) When a district has requested termination (with the approval of
the State or States affected).
Sec. 302.7 Eligibility of non-distressed areas.
Areas in districts which are not themselves eligible for assistance
under parts 305 or 308 may be eligible, as provided in Sec. 301.2(c).
PART 303--PLANNING PROCESS AND STRATEGIES FOR DISTRICT AND OTHER
PLANNING ORGANIZATIONS SUPPORTED BY EDA
Sec.
303.1 Definitions, purpose and scope.
303.2 Planning process.
303.3 Requirements for a strategy.
Authority: 42 U.S.C. 3211; Department of Commerce Organization
Order 10-4.
Sec. 303.1 Definitions, Purpose and Scope.
(a) As used in this part 303.
(1) Planning organization means an Economic Development District
organization, Indian tribe, or other recipient of an EDA grant under
part 306 which grant is awarded in whole or in part to develop, update,
or replace a CED Strategy, and
(2) Strategy committee means that committee or other entity
identified by the planning organization as responsible for developing,
updating, or replacing a strategy.
(b) This part describes the planning process of and requirements
for strategies developed and implemented by planning organizations
supported by EDA. The requirements for a strategy in this part 303
exceed the requirements of Sec. 301.3.
[[Page 5357]]
Sec. 303.2 Planning Process.
(a) The strategy committee must be inclusive and representative of
the main economic interests of the area covered by the strategy. Such
interests include public officials, community leaders, private
individuals, business leaders, labor groups, minorities, and others who
can contribute to and benefit from improved economic development in the
area covered.
(b) The planning organization must support the strategy committee
with a staff skilled in economic planning or related fields.
(c) The planning organization must conduct an initial and
continuous study and analysis of the opportunities for economic
development and of problems contributing to economic and related
distress in the area covered, such as, for example, unemployment,
underemployment, outmigration, or low per capita income, and possible
solutions to such problems.
(d) Planning organizations covered by this part 303 must submit an
initial strategy to EDA in compliance with the requirements of
Sec. 303.3, as determined by EDA. Each year thereafter, the planning
organization must submit an annual strategy report, acceptable to EDA.
(e) A new or revised strategy is required at least every five
years, or sooner if EDA or the planning organization determines that
the strategy is inadequate due to changed circumstances. Each strategy
must be available for review and comment by appropriate government
bodies and interest groups in the area covered. Strategies submitted by
Districts require concurrence by the State or States in which they are
located, prior to EDA approval. If EDA identifies any deficiencies, it
will notify the organization in writing and provide the organization a
reasonable opportunity to remedy such deficiencies.
Sec. 303.3 Requirements for a strategy.
A strategy must contain the following:
(a) An analysis of economic and community development problems and
opportunities including incorporation of any relevant material or
suggestions from other government sponsored or supported plans;
(b) Background and history of the economic development situation of
the area covered, with a discussion of the economy, including
geography, population, labor force, resources, and the environment;
(c) A discussion of community participation in the planning
efforts;
(d) A section setting forth goals and objectives for taking
advantage of the opportunities of and solving the economic development
problems of the area serviced;
(e) A plan of action, including suggested projects to implement
objectives and goals set forth in the strategy; and
(f) Performance measures that will be used to evaluate whether and
to what extent goals and objectives have been or are being met.
PART 304--GENERAL SELECTION PROCESS AND EVALUATION CRITERIA
Sec.
304.1 Project proposal, application, selection and evaluation for
programs under PWEDA.
304.2 How EDA evaluates proposals and applications for projects
funded under PWEDA.
Authority: 42 U.S.C. 3211; Department of Commerce Organization
Order 10-4.
Sec. 304.1 Project proposal, application, selection and evaluation for
programs under PWEDA.
(a) Local projects. Parties eligible as applicants who are
interested in a public works, economic adjustment, planning, local
technical assistance or university center project grant should contact
the appropriate Economic Development Representative (EDR) (or EDA
Regional or headquarters office), identified in the NOFA. The EDR or
other EDA official is available to provide program information,
including the current published NOFA; provide a proposal form approved
by the U.S. Office of Management and Budget (OMB), and provide
assistance as needed in filling out the proposal form.
(1) After submission of the proposal to the appropriate EDR or
Regional Office of EDA, the appropriate Regional Office Project Review
Committee (PRC), consisting of at least three EDA officials, will
review the proposal. The EDR or other appropriate EDA official will
evaluate the proposal under Sec. 304.2, program specific sections of
this rule, and the NOFA, if applicable, before submitting it to the EDA
Regional Office for its review.
(2) After review by the PRC, EDA will send a letter in a timely
manner to each submitter advising either that:
(i) EDA invites the submitter to prepare and present a formal
application on a standard application form, with attachments for the
type of grant being requested; or
(ii) EDA returns the proposal because of specified deficiencies and
suggests resubmission when the deficiencies are cured; or
(iii) EDA denies the proposal for specifically stated reasons.
(b) National Technical Assistance Research, Evaluation, or Training
Projects. Parties eligible as applicants who are interested in a
national technical assistance, research, evaluation, or training
project under PWEDA, should make initial contact with EDA in
Washington, D.C., at locations identified in the NOFA, for information
and assistance concerning proposals and to obtain program information,
including a copy of the current NOFA, and OMB approved proposal form.
After submission of the proposal to the appropriate EDA Washington,
D.C. office, generally, three or more technically knowledgeable EDA
officials will review the proposal for relevance and quality.
(1) If EDA determines that the proposal is acceptable under
Sec. 304.2, program specific sections of this rule, and the NOFA, if
applicable, EDA may by letter invite the submitter to provide an
application with a more detailed and comprehensive project narrative.
EDA expects that applications will generally be submitted within 30
days after receipt of an invitation letter.
(2) If EDA determines that the proposal is not acceptable because
of specified deficiencies, EDA will so notify the submitter in writing
in a timely manner.
(c) EDA expects that applications will generally be submitted
within 30 days after receipt of an invitation letter. EDA's invitation
to submit an application does not assure EDA funding.
Sec. 304.2 How EDA evaluates proposals and applications for projects
funded under PWEDA.
(a) General proposal and application evaluation criteria for
projects funded under PWEDA are as follows: EDA will screen all
proposals/applications for:
(1) Conformance to statutory and regulatory requirements,
(2) The relative severity of the economic problem of the area,
(3) The quality of the scope of work proposed to address the
problem,
(4) The merits of the activity(ies) for which funding is requested,
and
(5) The ability of the prospective applicant to carry out the
proposed activity(ies) successfully.
(b) EDA will also review applications for conformance with any
additional program specific evaluation criteria as stated in applicable
sections of these rules or the NOFA.
(c) The NOFA may identify special areas of interest or priority
consideration for the period of such NOFA.
[[Page 5358]]
PART 305--GRANTS FOR PUBLIC WORKS AND DEVELOPMENT FACILITIES
Subpart A--General
Sec.
305.1 Purpose and scope.
305.2 Criteria.
305.3 Application requirements.
305.4 Selection and evaluation.
Subpart B--Other Requirements
305.5 Disbursements of funds for grants.
305.6 Final inspection.
305.7 Requirements for approved projects.
Appendix A to Part 305--Requirements for Approved Construction
Projects.
Authority: 42 U.S.C. 3211; Department of Commerce Organization
Order 10-4.
Subpart A--General
Sec. 305.1 Purpose and scope.
The purpose of Public Works and Development Facilities grants is to
help the Nation's distressed communities revitalize and expand their
physical and economic infrastructure and thereby provide support for
the creation or retention of jobs for area residents by helping
eligible recipients with their efforts to promote the economic
development of distressed areas. The primary focus is on the creation
of new, or the retention of existing, long-term private sector job
opportunities in communities experiencing significant economic distress
as evidenced by high unemployment, low income, or a special need
arising from actual or threatened severe unemployment or severe changes
in local economic conditions. These grants are intended to help
communities achieve sustainable economic development by developing and
expanding new and existing public works and other infrastructure
facilities that will help generate long-term jobs and economic growth,
improve economic conditions or otherwise enhance and promote the
economic recovery of the area.
Sec. 305.2 Criteria.
(a) A grant may be made under part 305 for the following purposes:
(1) For the acquisition or development of land and improvements for
use for a public works, public service or other type of development
facility; or
(2) For the acquisition, design and engineering, construction,
rehabilitation, alteration, expansion, or improvement of such a
facility, including related machinery and equipment.
(b) A grant may be made under part 305 only when:
(1) The project for which the grant is applied for will, directly
or indirectly--
(i) Improve the opportunities, in the area where the project is or
will be located, for the successful establishment or expansion of
industrial or commercial plants or facilities;
(ii) Assist in the creation of additional long-term employment
opportunities in the area; or
(iii) Primarily benefit the long-term unemployed and members of
low-income families;
(2) The project for which the grant is applied for will fulfill a
pressing need of the area, or a part of the area, in which the project
is or will be located; and
(3) The area for which the project is to be carried out has a
strategy and the project is consistent with the strategy.
(c) Additional criteria, or priority consideration factors for
assistance, may be set forth in a NOFA.
(d) Maximum assistance for each State. Not more than 15 percent of
the annual appropriations available to carry out this part may be
expended in any one State.
Sec. 305.3 Application requirements.
Each application for a grant under part 305 must:
(a) Include evidence of area and applicant eligibility;
(b) Include, or incorporate by reference, a strategy, as provided
in Sec. 301.3;
(c) Identify the sources of the other funds, both eligible Federal
and non-Federal, that will make up the balance of the proposed
project's financing, including any private sources of financing. The
application must show that such other funds are committed to the
project and will be available as needed. The local share must not be
encumbered in any way that would preclude its use consistent with the
requirements of the grant; and
(d) Explain how the proposed project meets the criteria of
Sec. 305.2.
Sec. 305.4 Selection and Evaluation.
(a) Projects will be selected in accordance with the application
evaluation criteria set forth in Sec. 304.2 of this chapter.
(b) In addition to the evaluation criteria set forth in part 304 of
this chapter, project selection and evaluation will be made on the
basis of whether, and to what extent, the proposed project will:
(1) Assist in creating new or retaining existing private sector
jobs and assist in the creation of additional long-term employment
opportunities rather than merely transferring jobs from one area of the
country to another;
(2) Be supported by significant private sector investment;
(3) Leverage or be a catalyst for the effective use of private,
local government, State or other Federal funding that is available;
(4) Likely be started and completed in a timely fashion; and
(5) If the project is located in an area with a stable economy and
low distress, provide employment opportunities for residents of nearby
areas of high distress.
Subpart B--Other Requirements
Sec. 305.5 Disbursements of funds for grants.
(a) Disbursements of funds for construction grants are generally
made on a reimbursable basis on request of the recipient for
reimbursement. Disbursements may be made only:
(1) After execution of all contracts required for the completion of
the project. This condition may be waived by EDA if the grantee can
demonstrate that enforcement of the condition would place an undue
burden on it;
(2) For itemized and certified eligible costs incurred, as
substantiated by such documentary evidence as EDA may require;
(3) On the basis of the work accomplished and the percentage of EDA
participation, but in no event for more than the total sum stated in
the financial assistance award accepted by the grantee;
(4) Upon such evidence as EDA may require that grantee's
proportionate share of funds is on deposit;
(5) After a determination by EDA that all applicable terms and
conditions of the grant have been met; and
(6) After meeting such other requirements as EDA may establish in
accordance with other Federal laws, rules and regulations.
(b) Disbursements are generally made in installments, based upon
grantee's actual rate of disbursement in accordance with the grant
rate.
(c) Advances of funds are allowable when disbursement on a
reimbursable basis would impose an undue burden, as determined by EDA,
upon the recipient.
Sec. 305.6 Final inspection.
A final inspection will be scheduled by the recipient and
appropriate notification given to EDA, when the project has been
completed and all deficiencies have been corrected. EDA personnel may
attend and participate in the final inspection and, in any event, EDA
must be advised of the outcome of such final inspection and the
recipient's acceptance of the work.
[[Page 5359]]
Sec. 305.7 Requirements for Approved Projects.
(a) The requirements for approved projects are set forth in this
part and the EDA publication, Requirements for Approved Construction
Projects, Appendix A to this part displayed at EDA's web site, http://
www.doc.gov/eda. A copy of this publication is available from EDA and a
copy will be furnished to an award recipient with the Offer of
Financial Assistance.
(b) Financial, performance, and progress reports will be specified
in the Special Award Conditions of the grant.
Appendix A to Part 305--Requirements For Approved Construction
Projects
OMB Approval No. 0610-0096
Approval Expires 07/31/99
Burden Statement for REQUIREMENTS FOR APPROVED CONSTRUCTION
PROJECTS INTERIM NINTH EDITION, OCTOBER 1998:
Notwithstanding any other provision of the law, no person is
required to respond to, nor shall any person be subject to a penalty
for failure to comply with, a collection of information subject to
the requirements of the Paperwork Reduction Act, unless that
collection of information displays a currently valid OMB Control
Number.
The information is required to obtain or retain benefits from
the Economic Development Administration pursuant to Economic
Development Administration Reform Act, Public Law 105-393. The
reason for collecting this information is to enable the Economic
Development Administration to monitor construction projects for
compliance with Federal and other requirements. No confidentiality
for the information submitted is promised or provided except that
which is exempt under 5 U.S.C. 552(b)(4) as confidential business
information.
The public reporting burden for this collection is estimated to
average 18 hours per response including the time for reviewing
instructions, searching existing data sources, gathering and
maintaining the data needed, and completing and reviewing the
collection of information. Send comments regarding this burden
estimate or any other aspect of this collection of information,
including suggestions for reducing this burden to: Economic
Development Administration, Herbert C. Hoover Building, Washington,
DC, 20230, and to the Office of Information and Regulatory Affairs,
Office of Management and Budget, Washington, DC 20503.
Requirements for Approved Construction Projects
Table of Contents
Section I. General and Pre-Construction Requirements
1. Basis for Economic Development Administration Requirements
A. Applicable OMB Circulars & Code of Federal Regulations
B. Purpose of this publication
C. Changes to policies and procedures
D. Variances to these requirements
2. The EDA Grant Award
A. Project description
B. Standard terms and conditions
C. Special conditions
D. Grant expiration date
E. EDA approved budget
F. Performance measures
3. Initial Actions
A. Initial EDA Regional Office actions
B. Pre-award construction
C. Davis-Bacon requirement for pre-award construction
4. Project Management Conference
5. Selection of the Architect/Engineer
A. Pre-award selection of the A/E
B. Acceptable forms of contracts
6. The Architect/Engineer Contract for Services
A. Suggested forms for contract format
B. Acceptable types of cost reimbursement for A/E services
C. Prohibited forms of compensation
D. Basic and special services
E. Construction inspection
F. A/E record keeping and access to records
G. Required provisions of the A/E contract
7. Multiple Contracts and Phasing
A. Project phasing
B. Disbursement of the grant for phased projects
8. Recipient Furnished Equipment and/or Materials
9. Services Performed by the Recipient's Own Forces
A. Use of in-house forces
B. Use of force-account forces
10. Construction Management Services
A. Definition of construction management services
B. Cost threshold
C. EDA approval for cost reimbursement
D. Compensation
E. Assigning responsibility
11. Certification of Acquisition of Land, Easements and Rights-of-
Way
A. Title, easements, rights-of-way, etc.
B. Title opinions
C. Amount and cost of land, etc.
D. Changes in amount and cost of land
E. Federally owned/controlled airfield restriction
12. Relocation Assistance
13. Certification of Adequacy of Treatment of sewage and other waste
A. Certification of adequacy
B. Exceptions
C. Certification Requirements
14. Project Financing
15. Safeguarding Funds
A. Documentation of project costs
B. Use of minority banks
C. Separate bank accounts
D. Bonding of project fund custodian
16. Department of Commerce Metric Program
17. Seasonality
18. Design for the Handicapped
A. Source of requirement
B. Requirements for buildings
C. Exceptions
D. Waivers
19. Reporting of Project Progress
A. Recipient review of project progress
B. The project performance report
C. Project performance report due dates
D. Reporting non-routine performance items
E. Project performance report format
F. Grant advances
G. Delinquent performance reports
20. Environmental Requirements
A. Policy statement
B. Applicable directives
C. Hazardous substances requirements
21. Project Revisions
Section II: Contracting for Project Construction
1. Contracting Standards
A. State recipients
B. Recipients other than states
C. The contract administration system
D. Standards of conduct
E. State and local agreements
F. Use of surplus property
G. Value engineering
H. Awards to responsible contractors
I. Maintenance of records
J. Use of time and material contracts
K. Settlement of contractual issues
L. Protest procedures
2. Competition in Procurement
A. Full and open competition
B. Prohibition of use of state or local geographical preferences
C. Requirements for procurement actions
D. Use of prequalification lists
3. Acceptable Methods of Procurement
A. Small purchase procedures
B. Procurement by sealed bids
C. Requirements for sealed bids
D. Procurement by competitive proposals
E. Procurement by noncompetitive proposals
4. Unacceptable Method of Procurement
5. Contracting with Disadvantaged Firms
A. Affirmative steps for use of disadvantaged firms
6. Contract Cost and Price Analysis
A. The price analysis
B. The profit line item
C. Federal cost principles
D. Prohibited methods of contracting
7. Advertising for Bids
A. Frequency of advertisement for bids
B. Requirements for projects over $1,000,000
C. Additional circulation of invitation for bids
D. Thirty day limit
8. Bonding and Insurance Requirements
A. Minimum bond amounts
B. Insurance requirements
9. Bid Schedules for Alternative Materials
A. Use of bid schedules
B. Method of award
C. Exceptions and deviations
10. Non-EDA Work
A. Requirements for adding non-EDA work
B. Restrictions on award of contract
11. EDA Review of Proposed Procurement Documents
A. Procurement sytem certification
B. EDA aproval of contract documents
C. EDA prebid review
D. EDA preaward review
E. Use of standardized documents and checklists
F. Proceeding at recipient's risk
12. Construction and Services Contract Provisions
A. Required contract documents
[[Page 5360]]
B. Cost documentation
C. Required contract provisions
13. Wage Rates
A. Applicable act
B. Wage rate coverage
C. Different types of coverage
D. Period of wage rate validity
E. Application and exception for wage rates
F. Exceptions for railroads and public utilities
G. EDA or Department of Labor investigations
H. Record retention
I. Retroactivity of wage rates
14. The Bid Opening
A. EDA representation at the bid opening
15. Overrun at Bid Opening
A. When lowest bid exceeds funds available
B. When lowest bid less deductive alternates exceeds funds
available
16. Underrun at Bid Opening
A. EDA notification
17. EDA Approval of the Contract Award
A. EDA approval
B. Requirements for EDA approval
C. Checking debarred ineligible or suspended contractors
18. Executed Bid Award
A. Contents of executed contract documents to be furnished to
EDA
19. Preconstruction Conference
Section III: Construction Procedures
1. Recipient Responsibilities
A. Recipient responsibilities for project monitoring
B. Recipient responsibilities for project documents
2. Employment of Local Labor
A. Anticipated labor requirements
B. Inclusion in contracts and subcontracts
3. Construction Progress Schedule
A. Construction progress chart
B. Monthly update
C. Acceptable formats
4. Construction Sign
A. Contractor responsibility
B. Location of sign
C. Local agency coordination
D. Modification of sign specifications
E. Bilingual signs
5. Inspection of Construction
6. Occupancy Prior to Completion
A. Recipient responsibilities
B. Role of EDA
7. Contractor Payrolls
A. Payroll retention requirements
B. Applicable Executive Order and form
8. Civil Rights Requirements
9. Contract Change Orders
A. Notification to and approval from EDA
B. Cost and price analysis
C. Required copies
D. Prohibited change of scope
E. Change order requirements
F. EDA approval
G. Substantial variations
10. Inspection for Final Acceptance
A. Final inspection
B. Interested parties
11. Specific Requirements for Subcontractors
12. Safety
Section IV: Financial Administration
1. Standards for Financial Management Systems
A. Requirements for State recipients
B. Requirements for other recipients
C. EDA review
2. Grant Disbursements
A. The reimbursement method
B. Effect of program income
C. Withholding payments
D. Cash depositories
E. Interest earned on advances
3. Allowable Costs
A. Limitation on use of funds
B. Applicable cost principles
4. Period of Availability of Funds
A. General
B. Liquidation of obligations
5. Matching or Cost Sharing
A. Basic rule
B. Qualification and exceptions
C. Valuation of donated services
D. Valuation of 3rd party donated supplies and loaned equipment
or space
E. Valuation of 3rd party donated equipment, buildings and land
F. Valuation of Recipient donated real property for
construction/acquisition
G. Appraisal of real property
6. Program Income
A. General
B. Definition of program income
C. Cost of generating program income
D. Governmental revenues
E. Royalties
F. Sale of real property
G. Use of program income
H. Income after the award period
7. Non-Federal Audit
Section V: Amendments to Grant Agreements
1. General Requirements
A. Unforeseen problems
B. Types of project amendments
C. Change of scope determination
2. Changes to the Project Scope
A. Definition of project scope
B. Approval by EDA
C. Types of project modifications
D. EDA review of proposed modifications
3. Time Extensions
A. Recipient responsibilities
B. Suspension of disbursements
C. EDA right to suspend or terminate the grant
4. Budget Line Item Revisions
A. Requirements for approval by EDA
B. Transfers between budget line items
C. Transfer from contingencies line item
D. Use of underrun funds
E. Notification of budget line item changes
5. Additional EDA Funding
A. Request for additional EDA funds
B. Proceeding before EDA approval
6. Termination of the EDA Grant
A. Termination for cause
B. Termination for convenience
Section VI: Project Closeout Procedures
1. Audit Requirements
A. Securing Single Audit Act audit
B. Specific audits
C. Department of Commerce audits
D. Audit standards
2. Closeout Procedures
A. Beginning the closeout process
B. Final grant reports
C. Liquidation of obligations
D. The final grant disbursement
E. Eligible and ineligible costs
F. After closeout requirements
Section VII: Post Construction Grant Requirements
1. Real Property
A. Grantee ownership
B. EDA's reversionary interest
C. Successor grantees
D. Applicability of requirements
2. Definitions
3. Use of Property
A. Use only for authorized purposes
B. Property no longer needed for grant purpose
C. Property for lease or sale
D. Property substitutions
4. Unauthorized use
A. Disposal without EDA approval
B. EDA actions for disposal without approval
5. Federal Share
A. Calculation of federal share
B. Leasehold depreciation
C. Transfer to another eligible grantee
D. EDA interest after compensation
6. Encumbrances
A. Restrictions on encumbrances
B. Compensation for encumbrances
C. Waivers
D. Water and sewer exceptions
7. Civil Rights Restriction
8. Performance Reports
9. Record Retention
10. Program Income Earned After the Award Period
Section VIII: Exhibits
Section I--General and Pre-Construction Requirements
1. Basis for Economic Development Administration (EDA) Requirements
A. These Requirements for Approved Projects apply to all awards
for construction projects and they are based on Office of Management
and Budget (OMB) administrative requirements for Federal grants as
set forth in OMB Circulars and on regulations set forth in the Code
of Federal Regulations (CFR) Section 13 Chapter III, Section 15 Part
24 and Section 15 Part 14 as they may be amended.
B. These Requirements for Approved Projects are intended to
organize and explain the various requirements that apply to
Federally-assisted construction programs. They are not intended to
derogate, replace, or negate the above cited Federal requirements.
Conflicts between these Requirements for Approved Projects and the
documents referred to above should be brought to the attention of
EDA immediately. Any inconsistences or conflicts shall be resolved
in favor of such Federal requirements.
C. EDA, as a Federal agency, is obligated to promulgate policies
and procedures applicable to Recipients of EDA grants to insure
compliance with Federal requirements, to safeguard the public's
interest in the grant assets, and to promote the effective use of
grant funds in accomplishing the purpose for which they
[[Page 5361]]
were granted. Pursuant to this obligation, grant terms and
conditions require Recipients to comply with changes in regulations
and other requirements and policies EDA may issue from time to time.
Such changes apply to actions taken by all Recipients of EDA grants,
existing and prospective, after the effective date of the changes.
D. EDA's policy is to administer grants uniformly, but it is
understood that there may be situations warranting a variance. To
accommodate these situations and to encourage innovative and
creative ways to address economic development problems, requests for
variances to the requirements of this Requirements for Approved
Projects will be considered if they are consistent with the goals of
EDA programs, make sound and financial sense, and do not conflict
with applicable Federal and regulatory requirements.
2. The EDA Grant Award
The EDA grant award contains mandatory requirements and
information vital to the accomplishment of the project. It should be
read carefully with particular attention paid to:
A. The description of the project. This description and the
corresponding scope of work must be adhered to. Proposed changes to
EDA approved projects will be permitted by EDA only if they are
necessary to the proper functioning of the project. Enhancements to
the project that were not envisioned in the grant award will not be
approved for EDA participation.
B. The Standard Terms and Conditions for Title I Public Works
and Development Facilities and Title IX Economic Adjustment
Construction Projects. The Standard Terms and Conditions contain, by
reference or substance, a summary of the pertinent statutes,
regulations published in the Federal Register or Code of Federal
Regulations, Executive Orders or OMB Circulars.
C. The Special Conditions of the grant award. The Special
Conditions generally contain two types of information. The first
type relates specifically to the grant being awarded. The second
type relates to all approved grants and are of recent origin and
therefore have not yet been incorporated into the Standard Terms and
Conditions. Special attention should be paid to the Project
Development Time Schedule. The time schedule can only be extended as
a result of a written request from the Recipient and a written
approval by EDA. Failure to meet the time schedule is considered a
violation of the grant award and may result in action by EDA to
suspend and/or terminate the grant. No disbursement of EDA grant
funds is permitted when a project has exceeded the time schedule in
the grant award unless EDA has given written approval to a time
schedule extension.
D. Please note that, unless otherwise stated, EDA funds are
available for a period beginning at the time the project is approved
and ending five years after the end of the fiscal year in which the
project was approved. Any funds not disbursed to the Recipient
before the end of that period are automatically canceled and will be
deobligated and will no longer be available for payment of costs
incurred by the Recipient.
E. Combination construction and nonconstruction grants. If the
EDA grant award is for both construction and nonconstruction, the
Recipient must obtain prior written approval from EDA before making
any fund or budget transfer from nonconstruction to construction or
vice versa.
F. Performance Measures. The Standard Terms and Conditions of
the EDA grant award make reference to ``Core Performance Measures''
that require post-construction reports to be submitted to EDA. The
first report will be due at the completion of construction of the
project. The due dates for the submission of the second and third
reports are 3 years and six years after the completion of
construction. Questions regarding the content or submission of these
reports should be directed to EDA.
3. Initial Actions
A. After the Grant Award has been affirmed, the EDA Regional
Office will mail a pre-construction package to the Recipient that
includes a copy of ``Requirements for Approved Projects'', and a
list of items that need special attention (such as the project
development time schedule), and a list of any unresolved problems
identified during the preapproval review process. The EDA Project
Manager will then contact the Recipient to offer assistance and
guidance, to arrange for an updated schedule of the Recipient's
proposed activities and to arrange a Project Management Conference.
B. Because it is the policy of EDA to discourage the undertaking
of any construction prior to the submission of an application for
financial assistance, special consideration and judgment must be
executed if it becomes necessary for a project to proceed prior to
award of the EDA grant. Commencement of a project prior to approval
of the application for assistance is not prohibited, but it may
jeopardize the favorable consideration of such application since,
among other things, it raises a rebuttable presumption that funds
necessary for the accomplishment of the project are otherwise
available and that proper contracting procedures and labor standards
may not have been followed.
C. If construction of the project was begun before affirmation
of the grant award, the Recipient will be required to document to
EDA's satisfaction that it has complied with all EDA requirements,
including but not limited to the payment of Davis-Bacon wages from
the start of construction and environmental requirements, in order
to qualify for EDA reimbursement of costs incurred, if agreed to in
the grant award.
4. Project Management Conference
Whenever practical, the Project Management Conference will be
held at the Recipient's location; however, if necessary and required
for appropriate EDA personnel to be present, it may be held at
another location including in the Regional Office. The Recipient's
Authorized Representative, Architect/Engineer, attorney and possibly
the Recipient's financial representative should be in attendance.
Reasonable costs for transportation, meals and lodging for these
individuals are an authorized cost under the administrative line
item in the project budget. Per diem costs eligible for EDA
reimbursement may not exceed the current Federal per diem rate.
5. Selection of the Architect/Engineer
A. If an Architect/Engineer has been selected by the Recipient
prior to EDA approval of the grant award and the contract between
the Recipient and the Architect/Engineer has not been previously
submitted to EDA, it should be submitted as soon after the grant
award as possible. If the selection has not been made at the time of
grant award the contract should be sent to the EDA Regional Office
as soon as possible after its execution by both parties.
B. For EDA to participate in the cost for architect/engineer
services the Architect/Engineer must be selected competitively by
sealed bids (formal advertising) or by competitive proposals. If the
selection is made by competitive proposal the following requirements
apply:
(1) Requests for proposals shall be publicized and shall
identify all evaluation factors and their relative importance. Any
response to publicized requests for proposals shall be honored to
the maximum extent practical;
(2) Proposals will be solicited from an adequate number of
qualified sources (normally sufficient to secure at least three
proposals from qualified proposers);
(3) The Recipient will have a method for conducting technical
evaluations of proposals received and for selecting the best
proposal, price and other factors considered;
(4) The Recipient will determine the responsible firm whose
proposal is most advantageous to the program, with price and other
factors considered. Competitor's qualifications will be evaluated
and the most qualified competitor will be selected, subject to
negotiation of fair and reasonable compensation.
6. The Architect/Engineer Contract for Services
A. The architect/engineer agreement shall provide for all
services required by the Recipient for the planning, design and
construction phase of the proposed project. Appropriate standards or
guides developed by such professional organizations as the American
Consulting Engineers Council (ACEC), American Society of Civil
Engineers (ASCE), National Society of Professional Engineers (NSPE),
and/or the American Institute of Architects (AIA) may be used where
the Recipient does not have standard procurement documents.
B. The Architect/Engineer's fee for basic services must be
either a fixed price or a cost reimbursement with an agreed maximum
to be eligible for EDA participation. The amount of EDA
participation will be based on a determination, subject to audit,
that the compensation is reasonable.
C. The use of the cost-plus-a-percentage-of-cost and percentage
of construction cost forms of compensation are specifically
prohibited.
[[Page 5362]]
D. The Architect/Engineer's fee shall cover all services
necessary for the successful execution of the project, including
consultations, surveys, soil investigations, supervision, travel,
``as-built'' or record drawings, arrow diagram (CPM/PERT) where
applicable, and incidental costs. The basic fee shall not exceed
that prevailing for comparable services in the project area. If the
total fee is in excess of the prevailing rate because of special
services to be performed, these services shall be identified in the
agreement. Such additional charges may be approved for grant
participation by EDA if they:
(1) Do not duplicate a charge for services provided for in the
basic fee and are within the normal scope of the Architect/
Engineer's responsibilities;
(2) Are a proper charge against the project cost; and
(3) Are reasonable for the extra services to be rendered.
E. Regardless of who furnishes the construction inspector, the
Architect/Engineer shall be held responsible for making sufficient
visits to the project site to determine, in general, if the work is
proceeding in accordance with the construction contract.
F. All negotiated Architect/Engineer contracts (except those of
$100,000 or less awarded under small purchase procedures) awarded by
Recipients shall include a provision to the effect that the
Recipient, EDA, the Comptroller General of the United States, the
Inspector General of the Department of Commerce, or any of their
duly authorized representatives, shall have access to any documents,
books, papers, and records of the Architect/Engineer (which are
directly pertinent to a specific grant project) for the purpose of
making an audit, examination, excerpts, and transcriptions. The
Recipient shall require the Architect/Engineer to maintain all
required records for at least three years after the Recipient makes
final payment and all pending matters are closed.
G. EDA requirements for the agreement for Architect/Engineer
services are contained in Exhibit A-1 to these ``Requirements for
Approved Projects''.
7. Multiple Contracts and Phasing
A. The Recipient is strongly urged to award all contracts for
the project construction at one time. Where compelling reasons
justify phasing the project, the Recipient must secure the approval
of EDA for phasing prior to advertising any portion for bid. The
Recipient's request for approval of phasing must include:
(1) Valid reasons justifying the request, and
(2) A statement from the Recipient that it can, and will, fund
any overrun that arises in the later phases.
B. Normally EDA will not disburse funds until all construction
contracts have been awarded (an exception is the development of a
water source when required to determine the availability of an
adequate source of water supply in terms of both quality and
quantity as called for in the Grant Agreement). Disbursement of
grant funds by phases must be approved by EDA. Such approvals will
be given only if the Recipient can demonstrate that a severe
hardship will result if such approval is not given and there are
compelling reasons why all phases cannot be contracted for at the
same time. The Recipient must be capable of meeting incurred costs
prior to the first disbursement of EDA grant funds.
8. Recipient Furnished Equipment and/or Materials
The Recipient may wish to incorporate into the project equipment
and/or materials which it will secure through its own efforts. It is
the responsibility of the Recipient to assure that such equipment
and/or materials are adequate for the proposed use. The use of such
equipment and materials must be approved by EDA to be eligible for
EDA financial participation. The Recipient must be prepared to show
that the cost claimed for such equipment and/or materials is
competitive with local market costs. Acquisitions of Recipient
furnished equipment and/or materials under this section is subject
to the requirements of 15 CFR Part 24 or OMB Circular A-110 (or any
DOC rule implementing such Circular, as applicable). The Recipient
shall be required to submit with its request for approval either a
paid invoice or current quotes from not less than three suppliers
who normally distribute such equipment and/or materials. EDA may
require that major equipment items be subject to a lien in favor of
EDA and may also require a statement from the Recipient regarding
expected useful life and salvage value.
9. Services Performed by the Recipient's Own Forces
A. The Recipient may have a portion or all of the design,
construction, inspection, legal services, or other work and/or
services in connection with the project performed by personnel who
are employed by the Recipient either full-time or part-time (in-
house), subject to the following conditions:
(1) EDA must review and approve the Recipient's plan if this
method is to be elected by the Recipient.
(2) Such work or services performed by in-house personnel may be
considered an eligible cost for EDA reimbursement if in conformance
with Office of Management and Budget Circulars A-87, A-21 or A-122,
as appropriate.
(3) If a portion of the architect/engineer services is to be
performed by in-house forces, the Recipient will submit a statement
listing the services to be so performed. This statement should
accompany the architect/engineer agreement when it is submitted to
EDA for approval.
B. Due to the difficulty in monitoring force account
construction and the limited EDA staff available to perform the
monitoring, force account construction is strongly discouraged. The
force account method of construction may be approved only if:
(1) The Recipient has a special skill required for the
construction, e.g., construction of unique Indian structures, or
(2) Substantial cost savings can be demonstrated, or
(3) The Regional Office is satisfied that the Recipient has made
all reasonable efforts to obtain a contractor, but has failed to do
so because of uncontrollable factors, such as the remoteness of the
site combined with a small contract or an overabundance of
construction work in the project area, or
(4) It has been determined by EDA that special circumstances
require its use to successfully complete the project.
(5) EDA has available the publication, ``Guidelines for Force
Account Projects'', which can be secured from the EDA Regional
Office. This publication can be very helpful in ensuring that this
type of project activity would be an eligible project cost.
10. Construction Management Services
A. For the purposes of this document, Construction Management is
defined as the services of a firm with competent and experienced
staff to act as the Recipient's agent to perform all or part of the
following:
(1) Aid the project designer to find expedited or less costly
methods of construction (Value Engineering).
(2) Monitor the contracting process. This may vary in scope from
giving advice to the Recipient to complete control of the
contracting process.
(3) Inspection or supervision of inspection of the construction
work.
(4) Controlling the expenditure of project funds on a multi-
faceted or highly complex project.
(5) Controlling unusual methods of contracting such as ``fast
track'' or ``turn-key''.
B. EDA will not normally approve the use of a Construction
Management firm for projects costing less than $5 million.
C. If the Recipient wishes to use a Construction Manager, EDA
will participate in such costs only if EDA approves the proposed or
actual contract for such services between the Recipient and the
Construction Manager.
D. The compensation for Construction Management services is
subject to the same rules as those for architect/engineer services.
E. The Construction Management Agreement must spell out who is
responsible for construction inspection, approval of construction
and supply contracts, change orders and other areas of possible
conflicts (i.e., the division of responsibility and authority
between the Recipient, the Architect/Engineer and the Construction
Manager).
11. Certification of Acquisition of Land, Easements and Rights-of-
Way
A. As required in the Financial Assistance Award the Recipient
must furnish evidence satisfactory to the EDA that it has good and
merchantable title to the tracts or parcels of land on which
buildings, structures, or other project improvements will be
located, with any liens or encumbrances noted, and that it has
obtained all necessary easements, permits, rights-of-way,
franchises, condemnations, and all Federal, State and local
approvals necessary to the completion of the project.
B. To aid EDA in making its determination, the Recipient must
furnish a description of the sites and rights-of-way on which the
project will be located. Exhibit C of this
[[Page 5363]]
document is a ``Certificate as to Project Site, Rights-of-Way, and
Easements,'' which is a format acceptable to EDA as evidence of the
Recipient's title to the real property necessary for the project.
The Recipient has the option to prepare the title opinion in a
format that meets local law or custom. Any title opinion submitted
must be approved by EDA. EDA may require additional documentation.
C. If land acquisition is a part of the project, the EDA project
file must be documented to show the basis for determining that the
amount of land acquired and the cost of the land is reasonable. If
an appraisal is required, a professional appraiser(s) should perform
the service. An appraiser registered with a national society and/or
licensed by the State will normally be required.
D. Any significant change in the amount and cost of land from
that upon which the project approval was based must be approved by
EDA to be eligible for EDA reimbursement.
E. No financial assistance under the Act will be approved for a
project involving public or privately owned land adjacent to or in
the vicinity of a federally owned or operated airfield, unless the
Recipient can demonstrate that the proposed project is compatible
with the airfield land use plan prepared for that facility.
12. Relocation Assistance
The provisions of the Uniform Relocation Assistance and Real
Property Acquisition Policies Act of 1970 (P.L. 91-646), as amended,
are applicable to all States and political subdivisions of States
and non-profits which are recipients of EDA funding assistance. This
Act requires financial and other assistance to persons, businesses,
or farm operations displaced from real property acquired for a
project financed wholly or in part with Federal funds. It also
requires compliance with specific guidelines pertaining to
reimbursable costs incidental to such land acquisition. Recipients
are required to comply fully with the intent of this Act.
13. Certification of Adequacy of Treatment of Sewage and Other
Waste
A. EDA will not provide financial assistance for projects
involving sewer or other waste disposal facilities unless a State
permit has been obtained by the Recipient in those States where EPA
has delegated authority to the State to certify adequacy of
treatment. In those States where EPA has not delegated such
authority, a certificate of adequacy of treatment must be obtained
from EPA in addition to a State permit.
B. Certification of adequacy of treatment is not normally
required under the following conditions:
(1) For single service connections unless an unusual effluent is
expected.
(2) For replacement of portions of an existing sewer system
where sewage flow resulting from the project is not increased.
(3) For projects which will include only storm drainage as the
component and the flow from the storm sewer is not introduced in the
existing sanitary sewer system.
C. If EPA certification is required, EDA will not authorize the
advertising, bid opening nor a disbursement of grant funds until an
unconditional certificate has been obtained. The EDA Project Manager
will prepare all EDA requests to EPA for Certificates of Adequacy of
Treatment for projects which involve sewage and/or storm drainage
facilities. The certification should be obtained as early as
practicable after acceptance of the project application by EDA. The
Recipient must provide as much of the following information as is
required to obtain the certification:
(1) For sanitary sewer system.
a. A general descriptive statement of the project explaining the
problem to be eliminated and the proposed method of elimination.
b. A vicinity map of the complete project area showing the
location and size of all existing and proposed sanitary and storm
sewer lines in plan view, the street system, topographical features,
overflows and bypasses.
c. Project design criteria, including the following data:
(i) Industrial and domestic contribution. (Type of industrial
contribution should be stated).
(ii) Line and treatment facility sizing and design criteria used
therefor.
(iii) Population figures used.
(iv) Number of existing and planned sewer connections.
d. Design criteria to be used for the new treatment facilities.
This should include the following data:
(i) Type and extent of existing treatment.
(ii) Industrial and domestic contribution. (Type of industrial
contribution should be stated).
(iii) Peak and average flow data.
(iv) Component sizing and design criteria used therefor.
e. For existing treatment facilities to be affected by the
proposed project submit the design criteria, permit number and
effluent limitations.
f. If available, as-built drawings of existing treatment
facilities showing the location, type, number and size of the
treatment facilities. If as-built drawings are not available a
single line drawing of the existing structures such as lift
stations, manholes, pumping stations, etc., will be accepted.
g. Agreements, if any, for treatment by other entities.
(2) For projects involving only storm sewer facilities submit
the following dated statement, signed by the Recipient's authorized
representative; ``This proposed storm water sewer system will be
constructed and operated so as to exclude the introduction of
domestic sewage and industrial or agricultural waste and will not be
connected in any way to a sanitary sewer system.''
(3) Upon receipt by EDA, the certification of adequacy of
treatment will be reviewed to assure that the certification is
unconditional. EDA will not accept a conditional certification
(defined as an approval conditioned on the occurrence of a future
event such as the future construction of a sewage treatment plant).
14. Project Financing
Prior to obtaining EDA approval of the project's final plans and
specifications, the Recipient should furnish evidence to the EDA
Project Manager that the Recipient has its share of matching funds
either on hand or firmly committed. Any change in the amount or
availability of the Recipient's share must be made known to EDA at
this time. This is equally true of the interim financing amount and
availability.
15. Safeguarding Funds
A. Checks drawn to pay project costs will be signed by the
Authorized Representative of the Recipient and may be counter-signed
by other representatives of the Recipient if he/she so designates.
The Recipient shall retain all bank statements, deposit slips,
canceled checks, and related invoices pertaining to these project
costs to facilitate final audit.
B. Consistent with the national goal of expanding the
opportunities for minority business enterprises, Recipients are
encouraged to use minority banks as the depository for project
funds.
C. Although a separate bank account is not required by EDA, the
Recipient is urged to use one for the EDA project as it will be
helpful to audit project costs claimed by the Recipient at project
closeout.
D. For non-governmental Recipients EDA requires that the
Recipient furnish evidence that the custodian of the project funds
is bonded in an amount not less than the amount of the EDA grant. If
subject to 15 CFR Part 24, the Recipient must furnish assurances
that the Recipient's financial management system meets the
requirements of 15 CFR Part 24.20, Financial Administration, if this
was not accomplished prior to approval of the grant award.
16. Department of Commerce Metric Program
Section 5164 of the Omnibus Trade and Competitiveness Act of
1988 (P.L. 100-418) designates the metric system of measurement as
the preferred system of weights and measures for U.S. trade and
commerce.
17. Seasonality
It is EDA policy to promote construction of projects
continuously throughout the year. Recipients and their Architect/
Engineers are encouraged to design projects so that construction
will not be unreasonably curtailed by weather.
18. Design for the Handicapped
A. Any building or facility financed in whole or in part with
assistance under the Act must be designed, constructed, or altered,
so as to insure ready access to, and use of, such building or
facility by the physically handicapped, as required by P.L. 90-480
(42 U.S.C. 4151-4156) and the regulations promulgated thereunder (41
CFR Subpart 101-19.6).
B. Except as otherwise provided in paragraph C of this section,
every building, except a residential structure, shall be designed,
constructed, or altered in accordance with the minimum standards
contained in the ``American National Standard Specifications for
Making Buildings
[[Page 5364]]
and Facilities Accessible to, and Usable by, the Physically
Handicapped,'' Number A 117.1 (1971) approved by and available from
the American National Standards Institute, Inc., 1430 Broadway, New
York, NY 10018.
C. The standards established in paragraph (B) of this section
shall not apply to:
(1) The design, construction, or alteration of any portion of a
building or facility which need not, because of its intended use, be
made accessible to, or usable by, the public or by physically
handicapped persons;
(2) The alteration of an existing building if the alteration
does not involve the installation of, or work on, existing stairs,
doors, elevators, toilets, entrances, drinking fountains, floors,
telephone locations, curbs, parking areas, or any other facilities
susceptible of installations or improvements to accommodate the
physically handicapped;
(3) The alteration of an existing building or facility, or of
such portions thereof, to which application of the standards is not
structurally possible.
D. The standards established in paragraph (B) of this section
may be modified or waived on a case-by-case basis, provided that the
Administrator of the General Services Administration determines that
such waiver or modification is clearly necessary.
19. Reporting of Project Progress
A. Recipients are required to constantly monitor project
progress to assure that time schedules are being met, project work
units by time periods are being accomplished, and other performance
goals are being achieved. This review shall be made for each
program, function, or activity as set forth in the approved grant
application.
B. The Recipient is required to submit a project performance
report for each calendar quarter. The report will cover the
following for each program, function, or activity involved:
(1) A comparison of actual accomplishments to the timetable
established in the Grant Award;
(2) Reasons for delays in those cases where the time table
approved by EDA was not met;
(3) Any change to the purpose, nature, location, bona-fide need,
neighborhood served, size, funding, or cost of the project;
(4) All change orders issued up to the date of the report and
not previously reported to EDA, and
(5) Other pertinent information including, when appropriate, an
analysis and explanation of and cost overruns or high unit costs.
C. The project performance report will be due not later than
January 15, April 15, July 15 and October 15 for the immediate
previous quarter year. This requirement shall begin with the
Recipient's acceptance of the EDA Grant Award and shall end when EDA
approves the final grant disbursement.
D. Between the required performance reporting dates, events may
occur which have significant impact upon the project or program. In
such cases, the Recipient will be required to inform EDA as soon as
the following types of conditions become known:
(1) Problems, delays, or adverse conditions which will
materially affect the ability of the Recipient to attain program
objectives, prevent the meeting of time schedules and goals, or
preclude the attainment of project work by established time periods.
This disclosure shall be accomplished by a statement of the action
taken, or contemplated, and any Federal assistance needed to resolve
the situation.
(2) Favorable developments or events which enable meeting time
schedules and goals sooner than anticipated or producing more work
than originally projected; or
(3) If any performance review conducted by the Recipient
discloses the need for change in the budget estimates, the Recipient
is required to submit a request for budget revision.
E. A sample format for the required project performance report
is included herein as Exhibit J. The report will be sent to the EDA
Regional Office. The Recipient may use a format other than the EDA
sample, provided that the information called for in this section is
furnished.
F. EDA does not normally permit grant advances. However, where
EDA determines that grant advances are necessary and in the best
interest of the Government and the Recipient, the Recipient will be
required to submit with the project performance report a Report of
Federal Cash Transactions. The EDA Regional Office shall furnish the
required forms for this report.
G. EDA will not process any requests for grant disbursement from
Recipients with delinquent performance reports.
20. Environmental Requirements
A. EDA is required by law to insure that proper environmental
review of its actions take place; that there is a proper balance
between the goals of economic development and environmental
enhancement in its actions; and, that adverse environmental impacts
from its actions are mitigated or avoided to the extent possible.
B. Environmental assessments of EDA actions are conducted in
accordance with the National Environmental Policy Act of 1969, as
amended (NEPA) (42 U.S.C. 4321 et. seq.), the Environmental Quality
Improvement Act (42 U.S.C. 4371 et. seq.), The Clean Air Act, as
amended (42 U.S.C. 7401 et. seq.), the National Historic
Preservation Act of 1966 (16 U.S.C. 470 et. seq.), The Wild and
Scenic Rivers Act, as amended (16 U.S.C. 1271 et. seq.), the Flood
Disaster Protection Act of 1973, as amended (42 U.S.C. 4002 et.
seq.), the Federal Water Pollution Control Act, as amended (33
U.S.C. 1251 et. seq.), and the Council on Environmental Quality
(CEQ) Regulations (40 CFR Section 1500-1508), as specified in EDA
Directives 17.02-2, 17.02-7, and 17.04, as hereafter amended or
superseded. Directives are available from any EDA office.
C. EDA recipients are subject to Federal, state and local
requirements concerning hazardous substances, including, but not
limited to, the Comprehensive Environmental Response, Compensation
and Liability Act (CERCLA), Public Law 96-510 (1980), as amended by
Public Law 99-499 (1986), 42 U.S.C. 9601-9675; and the Resource
Conservation and Recovery Act (RCRA), Public Law 89-272 (1965), as
amended by Public Law 94-580 (1976), Public Law 96-482 (1980) and
Public Law 98-616 (1984), 42 U.S.C. 6901-6991.
21. Project Revisions
After Recipient acceptance of the EDA grant award, any change to
the project as described in the grant award must be reviewed and
approved by EDA. To be eligible for EDA financial participation the
proposed revision must meet certain conditions. See Section V of
this document for guidelines on securing EDA approval of proposed
project revisions.
Section II--Contracting For Project Construction
1. Contracting Standards
A. For States: If a State is the recipient of the EDA grant
award, the State may follow the same policies and procedures it uses
for procurements from its non-Federal funds provided that the State
will ensure that every purchase order or other contract includes any
clauses required by Federal statutes and Executive Orders and their
implementing regulations. For reimbursable cost determinations, OMB
Circular A-87 will be applicable.
B. For Other than States: Recipients of EDA grants other than
States may use their own procurement procedures which reflect
applicable State and local laws and regulations, provided that the
procurements conform to applicable Federal law and the standards
contained in these ``Requirements for Approved Projects''.
Recipients may request EDA to approve self-certification of their
procurement system. Such self-certification shall not limit EDA's
right to survey the system. The Recipient must cite specific
procedures, regulations, standards, etc. as being in compliance with
EDA and other Federal requirements and have its system available for
review. In the absence of written procurement regulations issued by
the Recipient which meet the following requirements, applicable
federal procurement standards shall govern.
C. Contract Administration System: Recipients will maintain a
contract administration system which ensures that contractors
perform in accordance with the terms, conditions and specifications
of their contracts or purchase orders.
D. Standards of Conduct: Recipients shall maintain a written
code or standards of conduct which shall govern the performance of
their officers, employees or agents engaged in the award and
administration of contracts supported by Federal funds. No employee,
officer or agent of the Recipient shall participate in selection, or
in the award or administration of a contract supported by Federal
funds if a conflict of interest, real or apparent, would be
involved. Such a conflict would arise when any of the following has
a financial or other interest in the firms elected for award:
(1) an employee, officer or agent
(2) any member of his/her immediate family
(3) his or her partner
(4) an organization which employs, or is about to employ, any of
the above.
The Recipient's officers, employees or agents shall neither
solicit nor accept
[[Page 5365]]
gratuities, favors or anything of monetary value from contractors,
potential contractors, or parties to subagreements except that
Recipients may set minimum rules where the financial interest is not
substantial or the gift is an unsolicited item of nominal intrinsic
value.
To the extent permitted by State or local law or regulations,
such standards of conduct shall provide for penalties, sanctions, or
other disciplinary actions for violations of such standards by the
Recipient's officers, employees, or agent, or by contractors or
their agents.
E. State and Local Agreements: To foster greater economy and
efficiency, Recipients are encouraged to enter into State and local
intergovernmental agreements for procurement or use of common goods
and services.
F. Surplus Property: Recipients are encouraged to use Federal
excess and surplus property in lieu of purchasing new equipment and
property whenever such use is feasible and reduces project costs.
G. Value Engineering: Recipients are encouraged to use value
engineering clauses in contracts for construction projects of
sufficient size to offer reasonable opportunities for cost
reductions. EDA will not normally approve value engineering costs
for construction contracts with estimated costs of less than
$1,000,000. Value engineering is defined for the purposes of this
paragraph as a systematic and creative analysis of each contract
item or task to ensure that its essential function is provided at
the overall lower cost. Value engineering, as a function, is done
separately from the architect/engineer design by a person or firm
not controlled by the architect/engineer.
H. Awards to Responsible Contractors: Recipients will make
awards only to responsible contractors possessing the ability to
perform successfully under the terms and conditions of a proposed
procurement. Consideration will be given to such matters as
contractor integrity, compliance with public policy, record of past
performance and financial and technical resources.
I. Maintenance of Records: Recipients will maintain records
sufficient to detail the significant history of each procurement
affecting the EDA assisted project. These records will include, but
are not necessarily limited to, the rationale for method of
procurement, selection of contract type, contractor selection or
rejection, and the basis for contract price.
J. Time and Material Contracts: Recipients will use time and
material type contracts only:
(1) After a determination that no other type of contract is
suitable, and
(2) If the contract includes a ceiling price that the contractor
exceeds at its own risk.
K. Settlement of Issues: Recipients alone will be responsible,
in accordance with good administrative practice and sound business
judgment, for the settlement of all contractual and administrative
issues arising out of procurements. These issues include, but are
not limited to source evaluation, protests, disputes and claims.
These standards do not relieve the Recipient of any contractual
responsibilities under its contracts. EDA will not substitute its
judgment for that of the Recipient unless the matter is primarily a
Federal concern. Violations of law will be referred to the local,
State, or Federal authority having proper jurisdiction.
L. Protest Procedures: Recipients will have protest procedures
to handle and resolve disputes relating to their procurements and
shall in all instances disclose information regarding the protest to
EDA. A protestor must exhaust all administrative remedies with the
Recipient before pursuing a protest with EDA. Reviews of protests by
EDA will be limited to:
(1) Violations of Federal law or regulations (violations of
State or local law will be under the jurisdiction of State or local
authorities); and
(2) Violations of the Recipient's protest procedures for failure
to review a complaint or protest. Protests received by EDA other
than those specified above will be referred to the Recipient for
resolution.
2. Competition in Procurement
A. All procurement transactions affecting the EDA project will
be conducted in a manner providing full and open competition
consistent with the standards contained herein. Some of the
situations considered to be restrictive of competition include but
are not limited to:
(1) Placing unreasonable requirements on firms in order for them
to qualify to do business,
(2) Requiring unnecessary experience and excessive bonding,
(3) Noncompetitive pricing practices between firms or between
affiliated companies,
(4) Noncompetitive awards to consultants that are on retainer
contracts,
(5) Organizational conflicts of interest,
(6) Specifying only a ``brand name'' product instead of allowing
``an equal'' product to be offered and describing the performance of
other relevant requirements of the procurement, and
(7) Any arbitrary action in the procurement process.
B. Recipients will conduct procurements in a manner that
prohibits the use of statutorily or administratively imposed in-
State or local geographical preferences in the evaluation of bids or
proposals, except in those cases where applicable Federal statutes
expressly mandate or encourage geographic preference. Nothing in
these Requirements for Approved Projects preempts State licensing
laws. When contracting for architectural and engineering (A/E)
services, geographical location may be a selection criteria provided
its application leaves an appropriate number of qualified firms,
given the nature and size of the project, to compete for the
contract.
C. Recipients will have written selection procedures for
procurement actions. These procedures will ensure that all
solicitations:
(1) Incorporate a clear and accurate description of the
technical requirements for the material, product, or service to be
procured. Such descriptions shall not, in competitive procurements,
contain features which unduly restrict competition. The description
may include a statement of the qualitative nature of the material,
product or service to be procured, and when necessary, shall set
forth those minimum essential characteristics and standards to which
it must conform if it is to satisfy its intended use. Detailed
product specifications should be avoided if at all possible. When it
is impractical or uneconomical to make a clear and accurate
description of the technical requirements, a ``brand name or equal''
description may be used as a means to define the performance or
other salient requirements of a procurement. The specific features
of the named brand which must be met by offerors shall be clearly
stated; and
(2) Identify all requirements which the offerors must fulfill
and all other factors to be used in evaluating bids or proposals.
D. Recipients will ensure that all lists of prequalified
persons, firms or products which are used in acquiring goods and
services are current and include enough qualified sources to ensure
maximum open and free competition. Also, Recipients will not
preclude potential bidders from qualifying during the solicitation
period.
3. Acceptable Methods of Procurement
A. Procurement by Small Purchase Procedures: Small purchase
procedures are those relatively simple and informal procurement
methods for securing services, supplies or other property that do
not cost more than the simplified acquisition threshold fixed at 41
U.S.C. 403(11) (currently set at $100,000) in the aggregate. If
small purchase procurements are used, price or rate quotations will
be obtained from an adequate number of qualified sources (normally
at least three quotes will be required).
B. Procurement by Sealed Bids (formal advertising): Bids are
publicly solicited and a firm-fixed-price contract (lump sum or unit
price) is awarded to the responsible bidder whose bid, conforming
with all the material terms and conditions of the invitation for
bids, is lowest in price. The sealed bid method is the preferred
method for procuring construction. In order for sealed bidding to be
feasible, the following conditions should be present:
(1) A complete, adequate and realistic specification or purchase
description approved by EDA is available,
(2) Two or more responsible bidders are willing and able to
compete effectively for the business, and
(3) The procurement lends itself to a firm fixed-price contract
and the selection of the successful bidder can be made principally
on the basis of price.
C. If sealed bids are used, the following requirements apply:
(1) The invitation for bids will be publicly advertised and bids
shall be solicited from an adequate number of known suppliers,
providing them sufficient time prior to the date set for the opening
of bids.
(2) The invitation for bids, which will include any
specifications and pertinent attachments, shall define the items or
services in order for the bidder to properly respond.
(3) All bids will be publicly opened at the time and place
prescribed in the invitation for bids.
[[Page 5366]]
(4) A firm fixed-price contract award will be made in writing to
the lowest responsive and responsible bidder. When specified in
bidding documents, factors such as discounts, transportation costs
and life cycle costs shall be considered in determining which bid is
lowest. Payment discounts will only be used to determine the low bid
when prior experience indicates that such discounts are usually
taken advantage of.
(5) Any or all bids may be rejected if there is a sound and
properly documented reason.
D. Procurement by Competitive Proposals: The technique of
competitive proposals may be used on EDA projects to secure
architect/engineer services and is conducted with more than one
source submitting an offer, and either a fixed price or cost-
reimbursement type contract is awarded. It is generally used when
conditions are not appropriate for the use of sealed bids. If this
method is used, the following requirements apply:
(1) Requests for proposals will be publicized and will identify
all evaluation factors and their relative importance. Any response
to publicized requests for proposals shall be honored to the maximum
extent practical.
(2) Proposals will be solicited from an adequate number of
qualified sources (normally EDA requires responses from at least
three responsible firms).
(3) Recipients will have a method for conducting technical
evaluations of the proposals received and for selecting awardees.
(4) Awards will be made to the responsible firm whose proposal
is most advantageous to the program, with price and other factors
considered.
(5) Recipients may use competitive proposal procedures for
qualifications-based procurement of architectural/engineering (A/E)
professional services whereby competitors' qualifications are
evaluated and the most qualified competitor is selected, subject to
negotiation of fair and reasonable compensation. The method, where
price is not used as a selection factor, can only be used in
procurement of A/E professional services. It cannot be used to
purchase other types of services though A/E firms are a potential
source to perform the proposed effort.
E. Procurement by Noncompetitive Proposals: This technique
requires EDA prior written concurrence and is conducted by
solicitation of a proposal from only one source, or after
solicitation of a number of sources, competition is determined
inadequate. Procurement by noncompetitive proposals may be used only
when the award of a contract is infeasible under small purchase
procedures, sealed bids or competitive proposals and one of the
following circumstances applies:
(1) The item is available only from a single source; or
(2) The public exigency or emergency for the requirement will
not permit a delay resulting from competitive solicitation; or
(3) After solicitation of a number of sources, competition is
determined inadequate.
4. Unacceptable Method of Procurement
The cost-plus-a-percentage-of-cost method of contracting is
unacceptable for use on EDA assisted projects. EDA grant funds may
not be used to reimburse costs incurred under such a contract.
5. Contracting with Disadvantaged Firms
A. The Recipient shall make positive efforts to utilize small
businesses, minority-owned firms, and women's business enterprises,
whenever possible. Recipients shall take all of the following steps
to further this goal.
(1) Ensure that small businesses, minority-owned firms, and
women's business enterprises are used to the fullest extent
practicable.
(2) Make information on forthcoming opportunities available and
arrange time frames for purchases and contracts to encourage and
facilitate participation by small businesses, minority-owned firms,
and women's business enterprises.
(3) Consider in the contract process whether firms competing for
larger contracts intend to subcontract with small businesses,
minority-owned firms, and women's business enterprises;
(4) Encourage contracting with consortiums of small businesses,
minority-owned firms and women's business enterprises when a
contract is too large for one of these firms to handle individually.
(5) Use the services and assistance, as appropriate, of such
organizations as the Small Business Administration, and the
Department of Commerce's Minority Business Development Agency in the
solicitation and utilization of small businesses, minority-owned
firms and women's business enterprises.
6. Contract Cost and Price Analysis
A. Recipients must perform a cost or price analysis in
connection with every procurement action including contract
modifications (change orders). The method and degree of analysis is
dependent upon the facts surrounding the particular procurement
situation, but as a starting point, Recipients must make independent
estimates before receiving bids or proposals. A cost analysis must
be performed when the offeror is required to submit the elements of
his estimated cost, e.g., under professional, consulting, and
architectural/engineering services contracts. A cost analysis will
be necessary when adequate price competition is lacking, and for
sole source procurements, including contract modifications or change
orders, unless price reasonableness can be established on the basis
of a catalog or market price of a commercial product sold in
substantial quantities to the general public or based on prices set
by law or regulation. A price analysis will be used in all other
instances to determine the reasonableness of the proposed contract
price.
B. Recipients 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 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. Costs or prices based on estimated costs for contracts under
grants will be allowable only to the extent that costs incurred or
cost estimates included in negotiated prices are consistent with
Federal cost principles (see OMB Circulars A-21, A-87 or A-122 as
applicable). Recipients may reference their own cost principles that
comply with the applicable Federal cost principles.
D. The cost-plus-a-percentage of cost and percentage of
construction cost methods of contracting shall not be used.
7. Advertising for Bids
A. In the absence of State or local law to the contrary, the
advertisement for bids should appear in publications of general
circulation a minimum of four times within a 30 day period prior to
the opening of bids.
B. When the estimated construction cost exceeds one million
dollars, the advertisement for bids should appear in publication(s)
with national circulation a minimum of four times within the 30-day
period prior to the opening of bids.
C. Additional circulation of the invitation for bids is
encouraged if it is needed to obtain the coverage necessary to
secure competitive bids.
D. Generally, a minimum of 30 days should be allowed for
submission of bids.
8. Bonding and Insurance Requirements
A. For construction or facility improvement contracts or
subcontracts exceeding $100,000 the following minimum bonding
requirements apply:
(1) The bonding company selected must be listed in U.S. Treasury
Department Circular 570.
(2) A bid guarantee from each bidder equivalent to five percent
of the bid price. 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 his bid, execute such contractual documents as
may be required within the time specified.
(3) A performance bond on the part of the contractor for 100
percent of the contract price.
(4) A payment bond on the part of the contractor for 100 percent
of the contract provisions.
B. The Recipient shall require that each construction contractor
and all subcontractors maintain, during the life of its contract,
Workmen's Compensation Insurance, Public Liability Insurance, and
such other types of special coverage required by the nature of the
work and State and local law. When appropriate, the Recipient shall
require the prime contractor to provide Builder's Risk Insurance as
part of the construction contract. In any case, the responsibility
for seeing that coverage is obtained and kept in force remains with
the Recipient. Such coverage is an eligible project cost, when
obtained by the Recipient directly.
[[Page 5367]]
9. Bid Schedules for Alternative Materials
A. Should the Recipient, acting upon the advice of his/her
consultant Architect/Engineer desire to obtain competitive prices
for differing materials, such bids should be requested on the basis
of ``Bid Schedule A'', ``Bid Schedule B'', etc. Bid Schedules, as
used herein, refer to the method used to obtain bids on more than
one material to be used for the same purpose. As an example, if
2,000 linear feet of sewer line were to be installed, Bid Schedule A
might call for the pipe material to be cast iron. Bid Schedule B
might call for the pipe material to be ductile iron. Bid Schedule C
might call for the material to be asbestos cement, etc.
B. If bids are asked for on the basis of two or more Bid
Schedules as set forth above, the bid documents must clearly set
forth that the contract will be awarded to the bidder having
proposed the lowest responsive bid within the amount of funds
announced as available by the Recipient to finance the contract and
including the Bid Schedule upon which that Contractor bid the lowest
price.
C. If the Recipient wishes to use a bid material which will
result in increased cost, EDA may permit the use of the material
chosen, but the amount of grant participation by EDA shall remain
based on the lowest responsive bid. The contract must be awarded to
the lowest bidder determined in accordance with the procedure
described above unless a deviation is specifically allowed in
applicable State and local law.
10. Non-EDA Work
A. If the Recipient plans to add work that is an addition to the
approved EDA project, the following will apply:
(1) The advertisement for bids, all bid documents, and contract
documents shall clearly define and separate the EDA portion of the
work from the non-EDA portion.
(2) The Recipient may offer for bid and award work in addition
to the EDA portion, provided:
a. the Recipient understands that EDA will participate in the
EDA portion only;
b. the additional work does not adversely affect the original
intent of the EDA project or its economic impact, as approved.
(3) Contracts shall be so drawn that the EDA-assisted portion of
the work is clearly identifiable at all times during construction.
(4) Underruns in the EDA project cannot be applied to assist the
Recipient in funding work which is not a part of the EDA project. It
is the responsibility of the Recipient to pay for all added work in
full.
(5) In the event of an overrun on the EDA portion of the work,
it is the Recipient's responsibility to supply the necessary
additional funds and to deposit such funds in the project account. A
revised project budget estimate will then be prepared which will
clearly show the portion of project cost to be shared by EDA and the
portion the Recipient must fund in its entirety. In addition, the
overall percentage participation of EDA in the project shall be
clearly identified.
B. When the EDA project is included with non-EDA assisted work,
the Recipient will normally award to the lowest bidder on all the
work. However, EDA participation will be based on the lowest bid for
the EDA-assisted portion. When this occurs, the Recipient will
prepare a memorandum to EDA, which will clearly present the details
of the award.
11. EDA Review of Proposed Procurement Documents
A. If a Recipient wishes to have its procurement system
certified by EDA, it should follow the procedures in Section II 1 B
of these ``Requirements for Approved Projects''. If EDA certifies
the Recipient's procurement system, the Recipient may not have to
submit proposed bid documents to EDA for approval if instead it
submits an executed copy of the Checklist for Construction Contracts
(see Exhibit A-2).
B. EDA approval of plans, specifications, contract and related
documents is to assure compliance with terms of the EDA grant award
and does not attest to the accuracy or completeness of design,
dimensions, details, proper selection of materials nor compliance
with required codes or ordinances. This responsibility rests with
the Recipient.
C. A pre-bid review of proposed construction bid documents by
EDA is required if:
(1) The procurement is expected to exceed the simplified
acquisition threshold (currently $100,000) and the Recipient's
procurement procedures and operations have not been certified by EDA
and/or do not comply with the procurement standards of this
document, or
(2) The scope of the work as approved in the EDA grant award has
changed, or
(3) The proposed bid documents specify one or more ``brand
name'' products.
D. A pre-award review by EDA is required if:
(1) The procurement is expected to exceed the simplified
acquisition threshold (currently $100,000) and is to be awarded
without competition after one bid or offer is received in response
to a solicitation, or
(2) The proposed award is more than the simplified acquisition
threshold and is to be awarded to other than the apparent low bidder
under a sealed bid procurement, or
(3) A proposed contract modification changes the scope of a
contract or increases the contract amount by more than the
simplified acquisition threshold, or
(4) The Recipient's procurement procedures or operation fails to
comply with the procurement standards in this Requirement for
Approved Construction Projects, or
(5) The procurement, which is expected to exceed the simplified
acquisition threshhold, specifies a ``brand name'' product.
E. It will greatly expedite EDA's review of the proposed bid
documents if the Recipient completes the Checklist for Construction
Contracts (Exhibit A-2), has it signed by the Recipient's authorized
representative and submits it to the EDA regional office with the
proposed construction bid package for approval. EDA review and
approval of the proposed contract documents will also be expedited
if the Recipient uses standardized documents such as ``Contract
Documents for Construction of Federally Assisted Water and Sewer
Projects'' jointly prepared, endorsed by, and available from, the
Environmental Protection Agency, the Rural Development Agency, the
Department of Housing and Urban Development, the Associated General
Contractors of America, the Consulting Engineers Council and the
National Society of Professional Engineers. Standardized contract
forms available from the American Institute of Architects are also
acceptable to EDA.
F. Until EDA has reviewed and approved the Recipient's proposed
contracts and related procurement documents, the Recipient will be
proceeding at its own risk regarding the eligibility of costs
incurred.
12. Construction and Services Contract Provisions
A. The proposed contract documents to be part of the invitation
for bids should contain at least the following:
(1) An Index.
(2) Advertisement for Bids.
(3) Information for Bidders.
(4) Bid Form.
(5) Contract Form.
(6) Bid Bond.
(7) Performance Bond.
(8) Payment Bond.
(9) General Conditions.
(10) ``Supplemental General Conditions'' (to be furnished by
EDA).
(11) Technical Specifications.
(12) Working Drawings.
(13) Notice of Requirements for Affirmative Action to Ensure
Equal Employment Opportunity (E.O. 11246 and 41 CFR 60-4) (Exhibit
E).
B. The package sent to EDA should also contain a documentation
of the estimated cost for the proposed contract (see Section II 6.
of these ``Requirements for Approved Projects'').
C. The Recipient shall include the following contract provisions
or conditions in all procurement contracts and subcontracts for the
EDA assisted project.
(1) Contracts in excess of the simplified acquisition threshold
(currently $100,000) shall contain provisions or conditions which
will allow for administrative, contractual, or legal remedies in
instances where contractors violate or breach contract terms, and
provide for such sanctions and penalties as may be appropriate.
(2) Contracts in excess of the simplified acquisition threshold
shall contain suitable provisions for termination by the Recipient
including the manner by which it will be effected and the basis for
settlement. In addition, such contracts shall describe conditions
under which the contract may be terminated for default as well as
conditions where the contract may be terminated because of
circumstances beyond the control of the contractor.
(3) All contracts awarded in excess of $10,000 by the Recipient
and their contractors or subrecipients shall contain a provision
requiring compliance with Executive Order 11246, entitled ``Equal
Employment Opportunity,'' as amended by Executive Order 11375, and
as supplemented in Department of Labor regulations (41 CFR Part 60).
(4) All contracts and subgrants in excess of $2,000 for
construction or repair shall
[[Page 5368]]
include a provision for compliance with the Copeland ``Anti-
Kickback'' Act (18 U.S.C. 874) as supplemented in Department of
Labor regulations (29 CFR, Part 3). This Act provides that each
contractor or subrecipient shall be prohibited from inducing, by any
means, any person employed in the construction, completion, or
repair of public works, to give up any part of the compensation to
which he/she is otherwise entitled. The Recipient shall report all
suspected or reported violations to EDA.
(5) All construction contracts in excess of $2,000 awarded by
the Recipient and Subrecipients shall include a provision for
compliance with the Davis-Bacon Act (40 U.S.C. 276a to a-7) as
supplemented by Department of Labor regulations (29 CFR Part 5).
Under this Act contractors shall be required to pay wages to
laborers and mechanics at a rate not less than the minimum wages
specified in a wage determination made by the Secretary of Labor. In
addition, contractors shall be required to pay wages not less often
than once a week. The Recipient shall place a copy of the current
prevailing wage determination issued for each solicitation and the
award of a contract shall be conditioned upon the acceptance of the
wage determination. The Recipient shall report all suspected or
reported violations to EDA.
(6) Where applicable, all contracts awarded by the Recipients
and Subrecipients in excess of $2,000 for construction contracts and
in excess of $2,500 for other contracts which involve the employment
of mechanics or laborers shall include a provision for compliance
with Sections 102 and 107 of the Contract Work Hours and Safety
Standards Act (40 U.S.C. 327-330) as supplemented by Department of
Labor regulations (29 CFR Part 5). Under Section 102 of this Act,
each contractor shall be required to compute the wages of every
mechanic and laborer on the basis of a standard work week of 40
hours. Work in excess of the standard work week is permissible
provided that the worker is compensated at a rate of not less than
1-\1/2\ times the basic rate of pay for all hours worked in excess
of 40 hours in the work week.
(7) Section 107 of the Contract Work Hours and Safety Standards
Act is applicable to construction work and provides that no laborer
or mechanic shall be required to work in surroundings or under
working conditions which are unsanitary, hazardous, or dangerous.
These requirements do not apply to the purchases of supplies or
materials or articles ordinarily available on the open market, or
contracts for transportation or transmission of intelligence.
(8) Contracts or agreements for the performance of experimental,
developmental, or research work shall provide for the rights of the
Federal Government and the Recipient in any resulting invention in
accordance with 37 CFR part 401, ``Rights to Inventions made by
Nonprofit Organizations and Small Business Firms under Grants,
Contracts and Cooperative Agreements''.
(9) All negotiated contracts (except those awarded by small
purchases procedures) awarded by the Recipient shall include a
provision to the effect that the Recipient, EDA, the Office of
Inspector General, the Comptroller General of the United States, or
any of their duly authorized representatives, shall have access for
the purpose of audit and examination to any books, documents,
papers, and records of the contractor which are directly pertinent
to that specific contract.
(10) The Recipient shall require contractors to maintain all
required records for three years after the Recipient makes final
payments and all other pending matters are closed.
(11) Contracts and subgrants of amounts in excess of $100,000
shall contain a provision that requires the Recipient to agree to
comply with all applicable standards, orders, or regulations issued
pursuant to the Clean Air Act (42 U.S.C. 7401 et seq.) and the
Federal Water Pollution Control Act as amended (33 U.S.C. 1251 et
seq.) Violations shall be reported to EDA and the regional office of
the Environmental Agency (EPA).
(12) Recipients and subrecipients must contain mandatory
standards and policies relating to energy efficiency which are
contained in the State energy conservation plan, where applicable,
issued in compliance with the Energy Policy and Conservation Act
(P.L. 94-165).
(13) EDA may require changes, remedies, changed conditions,
access and record retention and suspension of work clauses approved
by the Office of Federal Procurement Policy.
(14) The EDA project number should appear on all drawings and on
the face sheet of specification documents. In the case of a single
sheet layout included in folders, the project number should be shown
on the face of the sheet or at a
This text is long and has been trimmed here. Open the source document for the complete record.
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.