H SPEC PROV Const ACT 52 and 68 Rev.doc

SPECIAL PROVISIONS FOR CONSTRUCTION CONTRACTS

RESPONSIBILITY OF OFFERORS

Offeror shall furnish proof of compliance In accordance with Act 190 Amendment to HRS 103D-310(c)

Required as a prerequisite to entering into a contract, the contractor shall register on the Hawaii Compliance Express web site for all tax clearances by going to http://vendors.ehawaii.gov and registering there.

A Certificate of Vendor Compliance generated from this website should be included with their bid proposal. A Compliant status is required prior to awarding the contract.

COMPREHENSIVE ANNUAL FINANCIAL REPORTING

For any project that involves work on multiple structures, including non-building structures, whether it be new work or renovation work, or when the project involves both site improvements and a structure, the Contractor shall provide the following information to the Project Manager for fixed asset allocation purposes:

1.

Within 30 calendar days of award as applicable to the project, the following shall be submitted:

a.

The total cost of each individual structure;

b.

The total cost of on-site improvement work; and c.

The total cost of off-site improvement work.

2.

After all work, including all change order work has been completed, and prior to a request for final payment, the following shall be submitted:

a.

The total cost of each individual structure including any related change order cost;

b.

The total cost of on-site improvement work including any related change order cost; and c.

The total cost of off-site improvement work including any related change order cost.

3.

The sum total cost of each category noted above shall total to the contract amount awarded, plus all change order work issued.

a.

The cost of each individual structure includes the cost of the structure and any work within five (5) feet of the structure or building line which may include, but is not limited to its foundation, foundation earthwork, and utility improvements within and immediately below the building line.

b.

The on-site improvement cost includes all site improvement work from five (5) feet and beyond the building line and up to the project’s property line, which may include but is not limited to clearing and grubbing, grading, drainage system, site utility, walkway, parking lot, and landscape improvements.

c.

The off-site improvement cost includes all off-site improvement work outside of the project’s property line, which may include but is not limited to walkway, landscape, drainage, utility, and roadway improvements.

LIABILITY INSURANCE

The Contractor shall not commence any work until it obtains, at its own expense, all required liability insurance. Such insurance must have the approval of the State as to limit form and amount and must be maintained with a company acceptable to the State. Such insurance must be maintained for the full period of the contract and shall provide protection from claims arising out of or resulting from the Contractor's operations under the Contract itself Subcontractor or by anyone directly or indirectly employed by any of them or by anyone for whose acts any of them may be liable.

The contractor shall take out and maintain during the life of this contract broad form public liability (Bodily Injury) and broad form property damage liability insurance in a combined single limit not less than $1,000,000 and not less than $2,000,000 in the aggregate to protect such contractor and all his subcontractors from claims for damages for personal injury, accidental death and property damage which may arise from operations under this contract, whether such operations be by himself or anyone directly or indirectly employed by either of them and to include automotive liability, workers compensation and employers liability.

The insurance described herein will be maintained by the Contractor for the full period of the Contract and in no event will be terminated or otherwise allowed to lapse prior to final acceptance of the work by the State.

A certificate of insurance acceptable to the State shall be filed with the State prior to commencement of the work. Such certificate shall contain a provision that coverage afforded under the policy will not be canceled or changed until at least thirty days written notice has been given to the State by registered mail at the address denominated for the State in the Contract for official communications to it should any policy be canceled before final acceptance by the State, and the Contractor fails to immediately procure replacement insurance as specified, the State reserves the right to procure such insurance and to deduct the cost thereof from any sum due the Contractor.

BID PREPARATION

Offer Form, Page Of-1. Offeror is requested to submit its offer using Offeror’s exact legal name as registered with the Department of Commerce and Consumer Affairs, if applicable; and to indicate exact legal name in the appropriate space on Offer Form, page OF-1. Failure to do so may delay proper execution of the contract.

The authorized signature on the first page of the Offer Form shall be an original signature in ink. If unsigned or the affixed signature is a facsimile or a photocopy, the offer shall be automatically rejected unless accompanied by other material, containing an original signature, indicating the Offeror’s intent to be bound.

Hawaii Business. A business entity referred to as a “Hawaii business”, is registered and incorporated or organized under the laws of the State of Hawaii.

Compliant non-Hawaii business. A business entity referred to as a “compliant non-Hawaii business,” is not incorporated or organized under the laws of the State of Hawaii, but is registered to do business in the State.

Tax Liability. Work to be performed under this solicitation is a business activity taxable under Chapter 237, Hawaii Revised Statutes (HRS), and vendors are advised that they are liable for the Hawaii GET at the current rate.

4.712% tax rate. All businesses located on Oahu are required to pay the ½% County Surcharge tax on all Oahu transactions for which they pay the 4% GE tax. Neighbor island and out-of-state businesses that deliver goods or services to Oahu and have a ‘physical presence’ on Oahu, must pay the new ½% County Surcharge tax on their Oahu transactions.

4% tax rate. Neighbor island and out-of-state businesses that do not deliver any goods or services to Oahu are not subject to the new ½% County Surcharge tax.

If, however, an Offeror is a person exempt by the HRS from paying the GET and therefore not liable for the taxes on this solicitation, Offeror shall state its tax exempt status and cite the HRS chapter or section allowing the exemption.

Taxpayer Preference. For evaluation purposes, pursuant to §103D-1008, HRS, the Bidder's tax-exempt price offer submitted in response to an IFB shall be increased by the applicable retail rate of general excise tax and the applicable use tax. Under no circumstance shall the dollar amount of the award include the aforementioned adjustment.

AWARD OF CONTRACT

Method of Award. Award, if made, shall be to the responsive, responsible offeror submitting the lowest Lump Sum Bid unless otherwise noted in the bid documents.

Responsibility of Lowest Responsive Bidder. Reference Responsibility of Offerors in §3-122-112, HAR. If compliance documents have not been submitted to the State Department of Defense prior to award, the lowest responsive offeror shall produce documents to the procurement officer to demonstrate compliance with this section.

HRS Chapter 237 tax clearance requirement for award and final payment. Instructions are as follows:

In accordance with Act 190 Amendment to HRS 103D-310(c)

Required as a prerequisite to entering into a contract, the contractor shall register on the Hawaii Compliance Express web site for all tax clearances by going to http://vendors.ehawaii.gov and registering there.

A Certificate of Vendor Compliance generated from this website should be included with their bid proposal. A Compliant status is required prior to awarding the contract.

A current Certificate of Vendor Compliance must accompany the invoice for final payment on the contract.

HRS Chapters 383 (Unemployment Insurance), 386 (Workers’ Compensation), 392 (Temporary Disability Insurance), and 393 (Prepaid Health Care) requirements for award. Instructions are as follows:

Pursuant to §103D-310(c), HRS, The Certificate of Vendor Compliance must have a “Compliant” rating with the DLIR.

Compliance with Section 103D-310(c)(1) and (2), HRS.

Contractors are required to provide a state and federal tax clearance as a prerequisite to entering into a public contract of $2,500 or more. To meet this requirement, all bidders shall submit valid tax clearances with their bid proposals when the bid is $2,500 or more.

In accordance with Act 190 Amendment to HRS 103D-310(c), required as a prerequisite to entering into a contract, the contractor shall register on the Hawaii Compliance Express web site for all tax clearances by going to http://vendors.ehawaii.gov and registering there.

A Certificate of Vendor Compliance generated from this website shall be included with their bid proposal. A Compliant status is required prior to awarding the contract.

Failure to submit the required tax clearance will be sufficient grounds for the State to refuse to receive or consider the prospective bidder’s proposal.

The Certificate of Vendor Compliance should be applied for as soon as possible. If a valid certificate is not submitted on a timely basis for award of a contract, an offer otherwise responsive and responsible may not receive the award.

Final Payment Requirements. A current Certificate of Vendor Compliance will be required for final payment.

SPECIAL PROVISIONS for Act 68, SLH 2010, CONSTRUCTION CONTRACTS

DEFINITIONS FOR TERMS USED IN ACT 68, SLH 2010:

a.

“Contract” means contracts for construction under 103D, HRS.

b.

“Contractor” has the same meaning as in section 103D-104, HRS, provided that “contractor” includes a Subcontractor where applicable.

c.

“Construction” has the same meaning as in section 103D-104, HRS.

d.

“Procurement Officer” has the same meaning as in section 103D-104, HRS.

e.

“Resident” means a person who is physically present in the State of Hawaii at the time the person claims to have established the person’s domicile in the State of Hawaii and shows the person’s intent is to make Hawaii the person’s primary residence.

f.

“Shortage trade” means a construction trade in which there is a shortage of Hawaii residents qualified to work in the trade as determined by the Department of Labor and Industrial Relations.

EMPLOYMENT OF STATE RESIDENTS REQUIREMENTS – ACT 68, SLH 2010:

a.

A Contractor awarded a contract shall ensure that Hawaii residents compose not less than eighty percent of the workforce employed to perform the contract work on the project. The eighty percent requirement shall be determined by dividing the total number of hours worked on the contract by Hawaii residents, by the total number of hours worked on the contract by all employees of the contractor in the performance of the contract. The hours worked by any Subcontractor of the Contractor shall count towards the calculation for this section. The hours worked by employees within shortage trades, as determined by the Department of Labor and Industrial Relations (DLIR), shall not be included in the calculation for this section.

b.

Prior to starting any construction work, the Contractor shall submit the subcontract dollar amount for each of its Subcontractors.

c.

The requirements of this section shall apply to any subcontract of $50,000 or more in connection with the Contractor, that is, such Subcontractors must also ensure that Hawaii residents compose not less than eighty percent of the Subcontractors workforce used to perform the subcontract.

d.

The Contractor and any Subcontractor whose subcontract is $50,000 or more shall comply with the requirements of Act 68 for the entire duration of the contract.

1. Certification of Compliance for Employment of State Residents (attached) shall be made prior to submittal of the final invoice.

2. The Certification of Compliance for Employment of State Residents shall be made under oath by an officer of the company by completing a Certification of Compliance for Employment of State Residents form and executing the Certificate before a licensed notary public.

3. In addition to the certification as required above, the Contractor and Subcontractors shall maintain records such as certified payrolls for laborers and mechanics who performed work at the site and time sheets for all other employees who performed work on the project. These records shall include the names, addresses and number of hours worked on the project by all employees of the Contractor and Subcontractor who performed work on the project to validate compliance with Act 68. The Contractor and Subcontractors shall retain these records and provide access to the State for a minimum period of four (4) years after the final payment, except that if any litigation, claim, negotiation, investigation, audit or other action involving the records has been started before the expiration of the four (4) year period, the Contractor and Subcontractors shall retain the records until completion of the action and resolution of all issues that arise from it, or until the end of the four (4) year period, whichever occurs later. Furthermore, it shall be the Contractor’s responsibility to enforce compliance with this provision by any Subcontractor.

e.

A Contractor who fails to comply with this section shall be subject to any of the following sanctions:

1. Temporary suspension of work on the project until the Contractor or its Subcontractor complies with Act 68;

2. Withholding of payment on the contract until the Contractor or its Subcontractor complies with Act 68;

3. Permanent termination of the Contractor or Subcontractor from any further work on the project;

4. Recovery by the State, as applicable, of any moneys expended on the contract or subcontract as applicable; or

5. Proceedings for debarment or suspension of the Contractor or Subcontractor under Hawaii Revised Statues §103D-702.

Conflict with Federal Law:

This section shall not apply if the application of this section is in conflict with any federal law, or if the application of this section will disqualify the State from receiving Federal funds or aid.

Davis-Bacon Act:

Davis-Bacon Act prevailing wage rates apply to all State of Hawaii Construction contracts over $2,000.00.

SPECIAL PROVISIONS

SP - 4

CONSTRUCTION CONTRACTS

Revised 5/16