A State agency which receives a grant which requires contracting for construction or facility improvement (including any grant which provides for alterations or renovations of real property) shall follow its own requirements and practices relating to bid guarantees, performance bonds, and payment bonds except for contracts exceeding $100,000. For contracts exceeding $100,000, the minimum requirements shall be as follows:

(a) 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.

(b) A performance bond on the part of the contractor for 100 percent of the contract price. A performance bond is one executed in connection with a contract to secure fulfillment of all the contractor's obligations under the contract.

(c) A payment bond on the part of the contractor for 100 percent of the contract price. A payment bond is one executed in connection with a contract to assure payment as required by law of all persons supplying labor and material in the execution of the work provided for in the contract.

(OMB Circular No. A-102, Attachment B.) § 100b.122 Loan guarantees.

Where in connection with a grant, the Commissioner also guarantees the payment of money borrowed by the State agency, the Commissioner may, at his discretion, require adequate bonding and insurance if the bonding and insurance requirements of the State agency are not deemed to be sufficient to protect adequately the interests of the Federal Government.

(OMB Circular No. A-102, Attachment B.) Subpart K-Construction Requirements § 100b.155 Scope.

The provisions contained in this subpart apply to recipients of Federal fi

For the purposes of this subpart, the term "facilities" means one or more structures in one or more locations, constructed pursuant to this subpart. (20 U.S.C. 1221c(b)(1).)

§ 100b.157 Manner of construction.

Construction must be functional, undertaken in an economical manner, and not elaborate in design or extravagant in the use of materials in comparison with facilities of a similar type constructed in the State (or other applicable geographic area) within such period as may be designated by the State agency as appropriate for the purposes of this section. (20 U.S.C. 1221c(b)(1).)

§ 100b.158 Timeliness of work.

The recipient shall cause work on the project to be commenced within a reasonable time after receipt of notification from the State agency that funds have been awarded, and the project shall be prosecuted to completion with reasonable diligence.

(20 U.S.C. 1232c (b) (1).) § 100b.159

struction.

Commencement

of

con

(a) Approval by the State agency of the final working drawings and specifications shall be obtained before the proposed construction is advertised or placed on the market for bidding.

(b) The construction shall go to final completion in accordance with the application and approved drawings and specifications.

(c) The recipient shall submit to the State agency for prior approval changes that materially alter the scope or costs of the project, use of space, or functional layout.

(20 U.S.C. 1221c(b) (1).) § 100b.160

Civil rights assurance.

If an assurance of compliance with title VI of the Civil Rights Act of 1964 (Form HEW 441) applying to the facility described in the application has not been filed, such an assurance shall be attached to the application.

(42 U.S.C. 2000d.)

§ 100b.161 Title to site.

The recipient shall have, or shall obtain, a fee simple or such other estate or interest in the site, including access thereto, as is sufficient to assure undisturbed use and possession of the facilities for not less than the useful life of the facilities, or 50 years, whichever is the greater.

(OMB Circular No. A-102, Attachment N.) § 100b.164 Contracting.

(a) Except as otherwise provided by State or local law, all contracting for construction (including the purchase and installation of built-in equipment) shall be on a lump-sum fixed-price basis, and, except as provided in paragraph (b) of this section, contracts shall be awarded pursuant to Subpart I of this part on the basis of competitive bidding with award of the contract to the lowest responsive and responsible bidder.

(b) If one or more items of construction are covered by an established alternative procedure for awarding contracts, consistent with State and local laws and regulations, which is approved by the Commissioner and is designed to assure construction in an economical manner consistent with sound business practice, such alternative procedure may be followed.

§ 100b.168 Reports.

The recipient shall furnish such progress reports and such other information relating to the proposed construction and the project as the State agency may require.

(20 U.S.C. 1232c (b) (3).) § 100b.169

work.

Federal access to records and

Representatives of the Federal Government shall have access at all reasonable times to the recipient's records and to work whenever it is in preparation or progress, and the contractor shall be required under the contract to provide proper facilities for such access and inspection.

(20 U.S.C. 1232c (a) (2).)

§ 100b.170 Operation and maintenance. The facility shall be operated and maintained in accordance with the requirements of applicable Federal, State, and local agencies for the maintenance and operation of such facilities. (20 U.S.C. 1221c (b) (1).)

§ 100b.171 Cost-sharing and operational funds.

Sufficient funds shall be available to meet the non-Federal share of the cost of constructing the facility (where applicable), and sufficient funds shall be available when construction is completed to assure effective operation and maintenance of the facility for the purposes for which constructed. (20 U.S.C. 1221c (b) (1).)

§ 100b.172 Supervision and inspection.

The recipient shall provide and maintain competent and adequate architectural and engineering supervision and inspection at the construction site to insure that the completed work conforms to the approved drawings and specifications. (20 U.S.C. 1232c (b) (1).)

§ 100b.173 Cultural activities.

Reasonable provision shall be made, consistent with the other uses to be made of the facilities, for areas in such facilities which are adaptable for artistic and cultural activities.

(20 U.S.C. 1221c(b)(1).)

§ 100b.184 Safety and health.

In planning for and designing facilities, the recipient shall observe nationally recognized safety and health standards and codes, including National Fire Protection Association standards and those adopted under the Occupational Safety and Health Act of 1970 (Public Law 91-576): Provided, however, That to the extent that State and local codes are more stringent, they shall apply. (29 U.S.C. 651.)

Service and publised with periodical updatings in the FEDERAL REGISTER. Such information is to be furnished to the Department by the State agency to enable it to take into account such an effect and to consider the comments thereon of the Advisory Council on Historic Preservation, prior to providing such Federal financial assistance, as required by section 106 of Public Law 89-665. (16 U.S.C. 470f.)

§ 100b.187 Davis-Bacon, Copeland, and Contract Work Hours Standards Act. Except as otherwise provided by law, all laborers and mechanics employed by contractors and subcontractors on construction assisted under Federal programs, including minor remodeling, shall be paid wages at rates not less than those prevailing as determined by the Secretary of Labor in accordance with the Davis-Bacon Act, as amended, and shall receive overtime compensation in accordance with and subject to the provisions of the Contract Work Hours Standards Act. Such contractors and subcontractors shall comply with the provisions of 29 CFR part 3 ("anti-kickback" regulations); and all construction contracts and subcontracts shall incorporate the contract clauses required by 29 CFR 5.5 (a) and (c).

(20 U.S.C. 1232b; 40 U.S.C. 276a, 276c, 327332.)

Construction contracts shall include the applicable provisions of Executive Order No. 11246, as amended by Executive Order No. 11375 (nondiscrimination in construction contract employment), and the applicant shall otherwise comply with the requirements of section 301 of said Executive order.

(E.O. Nos. 11246, 11375.)

§ 100b.189 Access by the handicapped.

The recipient shall require the facility to be designed to comply with the "American Standard Specifications for Making Buildings and Facilities Accessible to, and Usable by, the Physically Handicapped," No. A117.1-1961, as modified by other standards prescribed by the Secretary or the U.S. Administrator of General Services (41 CFR 101-17.703). The applicant shall be responsible for conducting inspections to insure compliance with these specifications by the contractor.

(42 U.S.C. 4151, 4152, 4155.)

Projects receiving Federal financial assistance are subject to the regulations on relocation assistance and real property acquisition policies contained in part 15 of this title.

(20 U.S.C. 1221c (b) (1).)

§ 100b.192 Water pollution.

The recipient shall comply with Executive Order No. 11288 of July 7, 1966 (31 FR 9261), "Prevention, Control and Abatement of Water Pollution." (E.O. No. 11288)

Subpart L-Property Management
Requirements

§ 100b.209 Scope of subpart.

This subpart prescribes policies and procedures governing title, use, and disposition of real and tangible personal property whose acquisition cost was borne in whole or in part as a direct charge by Federal grants or subgrants and ownership and rights for intangible personal property developed under Federal grants and subgrants.

(OMB Circular No. A-102, Attachment N.) § 100b.210 General.

Recipients may follow their own property management policies and procedures: Provided, They observe the requirements of this subpart.

(OMB Circular No. A-102, Attachment N.) § 100b.211 Definitions.

As used in this subpart:

“Acquisition cost" of nonexpendable personal property acquired by purchase means the net invoice price of the property, including any attachments, accessories, or auxiliary apparatus necessary to make the property usable for the purpose for which it was acquired. Auxiliary

charges such as taxes, duty, protective in-transit insurance, freight, or installation shall be included in or excluded from acquisition cost in accordance with the recipient's regular accounting practices.

"Real property" means land, land improvements, structures and appurtenances thereto, excluding movable machinery and equipment.

(OMB Circular No. A-102, Attachment N.)

§ 100b.212 Real property.

Title to real property whose acquisition cost was borne in whole or in part by Federal funds shall vest in the recipient upon acquisition. In the absence of applicable statutory provisions governing the use or disposition of such property, it shall be subject to the following requirements, in addition to (and subject to) any other requirements imposed by the Statute or regulation:

(a) The recipient shall use the real property for the purposes authorized by the original grant or subgrant as long as needed.

(b) The State agency may authorize the recipient to use the property for the following (but no other) purposes when the recipient determines that the property is no longer needed for the orginally authorized purposes:

(1) Activities sponsored by other Federal awards (regardless of which Federal agency makes the other awards), or

(2) Activities not sponsored by other Federal awards, but which, nevertheless, have purposes consistent with those of the legislation under which the original award was made.

(c) (1) When no longer used in accordance with paragraphs (a) and (b) of this section the recipient shall return to the control of the Commissioner all real property whose acquisition cost was borne wholly by Federal funds. If the acquisition cost of the property was borne partly by Federal funds, the recipient may be relieved of accountability to the Federal Government with respect to the Federal interest in the property by compensating the Federal Government for its fair share of the current value of the property, or if the grantee no longer needs the property, by selling it and compensating the Federal Government for its fair share of the sales proceeds.

(2) The amount of compensation to the Federal Government under subparagraph (1) of this paragraph shall be computed by applying the percentage of Federal participation in the cost of the

project or program for which the property was acquired to the property's current fair market value (if the recipient retains the property) or to the proceeds from sale (if the recipient sells the property). In most cases, the real property will have been acquired under an award whose purpose was to assist the recipient in acquiring the property. In such cases, the "total cost of the project or program for which the property was acquired" will ordinarily be the same as the acquisition cost of the property.

(OMB Circular No. A-102. Attachment N.) § 100b.215 personal

property.

Nonexpendable

(a) Title. When nonexpendable personal property is acquired by a recipient wholly or in part with Federal funds, title shall be vested in the recipient.

(b) Use. (1) The recipient shall retain such property in the project as long as there is a need for such property to accomplish the purpose of the project, whether or not the project continues to be supported by Federal funds.

(2) When there is no longer a need for such property to accomplish the purpose of the project, the recipient shall use the property in connection with other Federal awards it has received in the following order or priority:

(i) Other awards under Federal programs administered by the Commissioner needing the property,

(ii) Awards of other Federal agencies needing the property.

(3) When the recipient no longer has need for such property in any of its federally assisted projects, the property may be used for the recipient's own official activities in accordance with the following standards:

(i) If the property had an acquisition cost of less than $500 per unit and has been used 4 years or more, the recipient may use the property without reimbursement to the Federal Government or sell the property and retain the proceeds.

(ii) For all of such property not covered under subparagraph (3) (i) of this paragraph, the recipient may retain the property for its own use provided that a fair compensation is made to the Federal Government for the Federal share of the property. The amount of such compensation shall be computed by applying the percentage of Federal participation in the cost of the project to the current fair market value of the property.

(c) Disposition. If the recipient has no need for the property, disposition of the property shall be made as follows:

(1) If the property had an acquisition cost of $1,000 or less per unit (except for property covered under paragraph (b) (3) (i) of this section) the recipient shall sell the property and reimburse the Federal Government in accordance with subparagraph (2) (iii) of this paragraph.

(2) If the property had an acquisition cost of over $1,000 per unit, the recipient shall request disposition instructions from the State agency. The State agency will issue instructions to the recipient within 120 days following the receipt of such request and the following procedures shall govern:

(i) If the recipient is instructed to ship the property elsewhere, the recipient will be reimbursed by the State agency with an amount which is computed by applying the percentage of the recipient's participation in the project to the current fair market value of the property, plus any shipping or interim storage costs incurred.

(ii) If the recipient is instructed to otherwise dispose of the property, the recipent will be reimbursed by the State agency for the costs incurred in such disposition.

(iii) If disposition instructions are not issued within the 120-day period specified in subparagraph (2) of this paragraph, the recipient shall sell the property and reimburse the Federal Government with an amount which is computed by applying the percentage of Federal participation in the project to the sales proceeds. The recipient may, however, deduct and retain from that amount $100 or 10 percent of the proceeds, whichever is greater, for the recipient's selling and handling expenses.

(d) Property management standards. Recipients' property management standards for nonexpendable personal property shall also include the following procedural requirements:

(1) Property records shall be maintained accurately and provide for: (i) A description of the property; (ii) manufacturer's serial number or other identification number; (iii) acquisition date and cost; (iv) source of the property; (v) percentage of Federal funds used in the purchase of the property; (vi) location, use, and condition of the property; and (vii) ultimate disposition data including sales price or the method used

to determine current fair market value if the grantee reimburses the Federal Government for the Federal share.

(2) A physical inventory of property shall be taken and the results reconciled with the property records at least once every 2 years to verify the existence, current utilization, and continued need for the property.

(3) A control system shall be in effect to insure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft of nonexpendable property shall be investigated and fully documented. The recipient shall be responsible for replacing or repairing (with funds of such recipient) property which is lost, damaged, or destroyed due to the negligence of the recipient.

(4) Adequate maintenance procedures shall be implemented to keep the property in good condition.

(5) Proper sales procedures shall be established for unneeded property which would provide for competition to the extent practicable and result in the highest possible return.

(OMB Circular No. A-102, attachment N.) § 100b.216 Expendable personal property.

(a) The recipient may at its option either retain or sell items of expendable personal property when no longer needed for any federally sponsored activity (including activities sponsored by other agencies).

(b) Compensation to the Federal Goverment is required if the aggregate fair market value of all of those items acquired with Federal assistance exceeds $500 when no longer needed for any federally sponsored activity. The amount of compensation shall be computed by applying the percentage of Federal participation in the cost of the original project to the current fair market value of items retained, and to the sales proceeds of items sold.

(OMB Circular No. A-102, attachment N.) § 100b.217 Intangible personal prop

erty.

(a) (1) All inventions conceived or first actually reduced to practice in the course of or under a federally assisted project are subject to Parts 6 and 8 of this title. Each invention shall be promptly and fully reported to the Assistant Secretary for Health, Department of Health, Education, and Welfare.