TERMS FOR MA 12-22-11.pdf

1. CONTRACT PERIOD

Contract period shall be for a twelve (12) month period beginning the date of the award with options to renew as indicated in the Specifications of this procurement.

2. RENEWAL CLAUSE

This contract may be extended at the completion of the initial contract period for 4 additional 1 year periods upon the mutual agreement of the parties. Such mutual agreement shall take the form of an amendment to the contract required pursuant to 200 KAR 5:311.

3. RENEWAL CLAUSE – OPTIONAL RENEWAL PERIOD

If the contract resulting from this Solicitation provides for an optional renewal period, the Commonwealth of Kentucky reserves the right to renegotiate any terms and/or conditions as may be necessary to meet requirements for the extended period. The vendor will be advised of any proposed revisions prior to the renewal periods. In the event proposed revisions cannot be agreed upon, either party shall have the right to withdraw without prejudice from either exercising the option or continuing the contract in an extended period.

4. BASIS OF PRICE REVISIONS

PRICE ADJUSTMENTS: Unless otherwise specified, the prices established by the contract resulting from this Solicitation shall be firm for the contract period subject to the following:

A: Price Increases: A price increase will not be allowed during the initial contract period.

The price increase must be based on industry wide price changes. The contract holder must request in writing a price increase at least ninety (90) days prior to renewal, and shall provide firm proof that the price increase(s) is justified. The Division of Engineering and Contract Administration may request additional information or justification. If the price increase is denied, the contract holder may withdraw from the contract without prejudice upon written notice and approval by the Division of Engineering and Contract Administration. Provided, however, that the Vendor must continue service, at the Contract prices, until a new Contract can be established (usually within sixty (60) days).

B. Price Decreases: The contract price shall be reduced to reflect any industry wide price decreases. The contract holder is required to furnish the Division of Engineering and Contract Administration with notice of any price decreases, as soon as such decreases are available.

C. Extended Contract Periods: If the contract provides for an optional renewal period, a price adjustment may be granted at the time the contract is renewed, subject to price increase justification as required “A. Price Increases”.

5. TAXES

Kentucky Sales and/or Use Tax Bidders are informed that construction contracts for the Commonwealth of Kentucky are not exempt from the provisions of the Kentucky Sales and/or Use Tax. All adjustments and allowances for the current sales/or use tax shall be provided for in the Quotation amount and no later adjustments to the Quotation Sum will be permitted and/or made on this basis.

Federal Excise Tax The Commonwealth of Kentucky is entitled to exemption from Federal Excise Tax. All Bidders shall take this into consideration in their Quotation price.

6. ADDITIONS AND DELETIONS

The Division of Engineering and Contract Administration reserves the right to add new and similar items, with the consent of the vendor, to any contract awarded from this Solicitation. A Contract Modification will be issued by the Division of Engineering and Contract Administration to effect this change.

7. CONTRACT MODIFICATIONS

No modification or change of any provision in this contract shall be made, or construed to have been made, unless such modification is mutually agreed to in writing by the contractor and the Commonwealth, and incorporated as a written amendment to the contract and processed through the Division of Engineering and Contract Administration and approved by Finance and Administration Cabinet prior to the effective date of such modification or change pursuant to KRS 45A.210(1) and 200 KAR 5:311.

Memoranda of understanding, written clarification and correspondence shall not be construed as amendments to the contract.

If the contractor finds at any time that existing conditions made modification of the contract necessary, he shall promptly report such matters to the buyer for consideration and decision.

8. ASSIGNMENT

The contractor shall not assign the contract in whole or in part or any payment arising therefrom without the prior written consent of the Purchasing Officer. Any purported assignment is void.

9. FINAL AGREEMENT

The contract represents the entire agreement between the parties with respect to the subject matter hereof. Prior negotiations, representations or agreements, either written or oral, between the parties hereto relating to the subject matter hereof shall be no effect upon this contract.

10. PRECEDENCE OF PROVISIONS

The Commonwealth’s acceptance of the bidder’s offer in response to the solicitation, indicated by the issuance of a contract award, shall create a contract between the parties consisting of the following: (1) the Solicitation (including the Special Conditions and Specifications), and any addenda thereto; (3) General Conditions; (4) the contractor’s offer in response to the solicitation; and (5) any clarifications concerning the contractor’s offer in response to the solicitation.

In the event of any conflict between or among the provisions contained in the Contract, the order of precedence shall be as enumerated above.

11. ACCESS TO RECORDS

The contractor, as defined in KRS 45A.030 (9) agrees that the contracting agency, the Finance and Administration Cabinet, the Auditor of Public Accounts, and the Legislative Research Commission, or their duly authorized representatives, shall have access to any books, documents, papers, records, or other evidence, which are directly pertinent to this contract for the purpose of financial audit or program review. Records and other prequalification information confidentially disclosed as part of the bid process shall not be deemed as directly pertinent to the contract and shall be exempt from disclosure as provided in KRS 61.878(1)(c). The contractor also recognizes that any books, documents, papers, records, or other evidence, received during a financial audit or program review shall be subject to the Kentucky Open Records Act, KRS 61.870 to 61.884.

In the event of a dispute between the contractor and the contracting agency, Attorney General, or the Auditor of Public Accounts over documents that are eligible for production and review, the Finance and Administration Cabinet shall review the dispute and issue a determination, in accordance with Secretary's Order 11-004.

12. AUDIT PROVISIONS

The Finance and Administration Cabinet may inspect the place of business of the contractor or any subcontractor under the contract awarded or to be awarded by the Commonwealth.

In accordance with KRS 45A.150, the Finance and Administration Cabinet may audit the books and records of any person who has submitted cost or pricing data under KRS 45A.120 at any time until three years from the date of final payment under the prime contract, and by any subcontractor for a period of three years from the date of final payment under the subcontract. Such books and records shall be maintained by the contractor for a period of three years from the date of final payment under the contract and by any subcontractor for a period of three years from the date of final payment under the subcontract.

The Finance and Administration Cabinet shall be entitled to audit the books and records of a contractor or any subcontractor under any negotiated contract or subcontract other than a firm fixed-price type contract, provided, however, that this provision shall not limit the right to audit stated above. Such books and records shall be maintained by the contractor for a period of three years from the date of final payment under the prime contract and by the subcontractor for a period of three years from the date of final payment under the subcontract.

The contractor shall place such the same audit requirement in any agreement it may have with a subcontractor under this contract.

13. CONTRACTOR’S OBLIGATIONS

The Contractor shall and will, in good workmanlike manner, do and perform all work and furnish all supplies and materials, machinery, equipment, facilities and means, except as herein otherwise expressly specified necessary or proper to perform and complete all the work required by contracts issued under these specifications and conditions. The Contractor alone shall be responsible for the safety, efficiency, and adequacy of his plant, appliances, and for methods and for any damage which may result from their failure or their improper construction or maintenance equipment. The Contractor shall observe, comply with, and be subject to all terms, conditions, requirements and limitations of the contract and specifications, and shall do, carry on, and complete the entire work to the satisfaction of the Owner.

14. SAFETY OF PERSONS AND PROPERTY

The Contractor shall continuously maintain adequate protection of all Work from damage and shall protect the Owner’s property from injury or loss arising in connection with this Contract. He shall make good any such damage, injury, or loss, except such as may be directly due to errors in the Solicitation or caused by agents or employees of the Owner. He shall adequately protect adjacent property as provided by law and the Solicitation.

The Contractor shall take all necessary precautions for the safety of employees on the Work site, and shall comply with all applicable provisions of federal, state, and municipal safety laws and building codes to prevent accidents or injury to persons on, about, or adjacent to the premises where the Work is being performed.

15. PROTECTION OF PREMISES

The contractor shall provide and properly maintain protection as required by the governing laws, rules, regulations, and ordinances together with such additional protection as may be required for the safety of workmen and the public.

16. CLEANUP

The Contractor shall at all times keep the Project premises and surrounding area free from the accumulation of waste materials or rubbish caused by his operations in connection with the Project.

Upon completion of the Work, and prior to final inspection and acceptance, the Contractor shall remove all remaining waste materials, rubbish, Contractor’s construction equipment, tools, machinery, and surplus materials and leave the Project (including but not limited to glass, hardware, fixtures, masonry, tile and marble) in a clean and usable condition satisfactory to the Architect. If the Contractor fails to clean up as provided in the Contract Documents, the Owner may perform the cleaning tasks and charge the cost to the Contractor.

17. DAMAGED FACILITIES

The contractor shall repair and/or replace damaged facilities caused by work performed under this contract.

18. HAZARDOUS MATERIALS

In the event the Contractor unexpectedly encounters on the site material reasonably believed to be asbestos, polycholorinated biphenyl (PCB) or other classified hazardous substances/materials which have not been rendered harmless, the Contractor shall immediately stop Work in the area affected and report the condition to the Owner. The Work in the affected area shall not thereafter be resumed except by written agreement of the Owner and Contractor if in fact the material is asbestos, polychlorinated biphenyl (PCB), or other classified hazardous substances/materials which have not been rendered harmless. The Work in the affected area shall be resumed in the absence of any classified hazardous substances/materials or when it or they have been rendered harmless.

19. INSPECTION OF WORK

The Owner reserves the right to inspect the work during the contract period. If any portion of the materials or maintenance work does not meet the required specification, the Contractor shall remove and/or replace at the Contractor’s expense.

The Contractor shall permit the Owner and/or his representatives to inspect and review work, materials, payrolls, records or personnel, condition of employment, invoices on materials, books of account, and other relevant data and records with respect to the Contract.

The Owner has the right to test materials and submit for laboratory testing.

20. CORRECTION OF WORK PRIOR TO FINAL PAYMENT

The Contractor shall promptly correct Work rejected by the Department as failing to conform to the requirement of the Solicitation.

In addition to being responsible for correcting the Work and removing any nonconforming Work or materials which are not corrected from the jobsite, the Contractor shall bear all other costs of bringing the affected Work into compliance with the Solicitation.

If the Contractor fails to correct nonconforming Work within a reasonable time, the Owner may take steps to correct the Work itself. If, within a ten (10) day period after receipt of written notice to correct the nonconformity, the Contractor has not made serious efforts to correct the nonconformity, the Owner may without prejudice to any other remedies it may have, proceed to correct the non-conforming Work.

An equitable deduction from the Quotation Sum will be made to cover the cost of correcting the Work.

21. BID SECURITY NOT REQUIRED ON THIS PROJECT

Bids shall be accompanied by a bid guarantee of not less that five percent (5%) of the amount of the base bid executed with a licensed resident or non-resident agent who represents insurance companies authorized to do business in Kentucky.

This bid security secures the bidder’s promise (1) to enter into a contract with the Owner on the terms stated in his bid proposal, and (2) if required, to furnish bonds covering the faithful performance of the contract and the payment of all obligations thereunder. Should the Bidder refuse to enter into a contract or fail to furnish the required performance and payment bonds, the amount of the bid security shall be forfeited to the Owner as liquidate damages, not as a penalty.

The Purchasing Officer shall retain the bid security of Bidders until either (a) the contract has been executed and performance and payment bonds have been furnished, or (b) the specified time has elapsed so that bids may be withdrawn, or (c) all bids have been rejected.

22. PERFORMANCE AND PAYMENT BONDS NOT REQUIRED ON THIS PROJECT

The Contractor shall furnish separate performance and payment bonds to the Owner. The Contractor shall furnish a performance bond satisfactory to the Owner in an amount equal to one hundred percent (100%) of the Quotation Sum as security for the faithful performance of the Quotation. The Contractor shall also furnish a payment bond satisfactory to the Owner in an amount equal to one hundred percent (100%) of the Quotation Sum for the protection of all persons performing labor or furnishing materials, equipment or supplies for the Contractor for the performance of the Work provided for in the Quotation, including security for payment of all unemployment contributions which become due and payable under Kentucky Unemployment Insurance Law.

Each bond furnished by the Contractor shall incorporate by reference the terms of the Quotation as fully as though they were set forth verbatim in such bonds. In the event the Quotation Sum is adjusted by Change Order executed by the Contractor, the penal sum of both the performance bond and the payment bond shall be deemed increased by like amount.

The insurance coverage required by the Quotation documents shall be in compliance with the laws of the Commonwealth of Kentucky and shall be placed with a licensed resident or non-resident agent who represents insurance companies authorized to do business in Kentucky.

Unless the Project is exempt from the prevailing wage requirements of KRS 337.505-337.550, the Contractor’s bond(s) shall include a provision as will guarantee the faithful performance and payment of the prevailing hourly wage as set forth in the schedule incorporated in the Contract.

23. SUBCONTRACTORS

Unless provided for in the solicitation, no subcontract shall be made by the contractor with any other party for furnishing any of the work or services herein contracted without notification to the Commonwealth. This provision shall not require the notification of contracts of employment between the contractor and personnel assigned for services thereunder.

All references to the contractor shall be construed to encompass both the contractor and any subcontractors of the Contractor.

In the event subcontractors are accepted, the Contractor is fully responsible to the Owner for the acts and omissions of his subcontractors and of persons either directly or indirectly employed by them.

24. CONTRACTOR PAYMENTS TO SUBCONTRACTORS

Contractor shall promptly pay each subcontractor upon receipt of payment from the Owner the amount to which said subcontractor is entitled, reflecting the percentage actually retained, if any, from payments to the Contractor on account of such subcontractor’s work.

25. INDEMNIFICATION

The Contractor shall indemnify and hold the Owner harmless from any and all claims, liability, damage, loss, cost and expense of every type whatsoever including, without limitation, attorneys’ fees and expenses, in connection with the Contractor’s performance of this Contract, provided that such claims, liability, damage, loss, cost or expense is due to sickness, personal injury, disease or death, or to loss or destruction of tangible property (other than the Work itself), including loss of use resulting therefrom, to the extent caused by the Contractor, or anyone for whose acts the Contractor may be liable, regardless of whether such liability, claim, damage, loss, cost or expense is caused in part by the Owner.

26. FORCE MAJEURE

The Contractor will not be liable for any excess cost to the Commonwealth if the failure to perform the Contract arises out of causes beyond the control and without the fault or negligence of the Contractor. Such causes may include, but are not restricted to, acts of God, fires, quarantine restriction, strikes and freight embargoes. In all cases, the failure to perform must be beyond the control and without fault or negligence of the Contractor. The Contractor will take all possible steps to recover from such occurrences.

27. TERMINATION OF CONTRACT FOR CONVENIENCE OF OWNER

The Owner, for any reason whatsoever, may terminate the Quotation or its own convenience when it determines that such termination will be in the best interest of the Commonwealth of Kentucky. The Owner shall give written notice of such termination to the Contractor specifying when termination becomes effective. The Contractor shall incur no further obligations in connection with the Work and the Contractor shall stop Work when such termination becomes effective. The Contractor shall also terminate outstanding orders and subcontracts. The Contractor shall settle the liabilities and claims arising out of the termination of Subcontracts and orders. The Owner may direct the Contractor to assign the Contractor’s right, title and interest under termination orders or subcontracts to the Owner or its designee.

The Contractor shall transfer title and deliver to the Owner such completed or partially completed Work and materials, equipment, parts, fixtures, information and Quotation rights as the Contractor has. The Commonwealth shall negotiate a fair and just settlement with the Contractor in accordance with 200 KAR 5:312 Section 2. In such event, the following procedure shall be required:

(1) The Contractor shall submit a termination claim to the Owner specifying the amounts due because of the termination for convenience together with costs, pricing or other data required by the Owner. If the Contractor fails to file a termination claim with one (1) year from the effective date of termination, the Owner shall pay the Contractor, an amount derived in accordance with paragraph (3) below:

(2) The Owner and the Contractor may agree to the compensation, if any, due to the Contractor hereunder pursuant to 200 KAR 5:312 Section 2;

(3) Absent agreement to the amount due to the Contractor, the Owner shall pay the Contractor the following amounts:

(a) Contract prices for labor, materials, equipment and other services accepted under this Quotation.

(b) Reasonable costs incurred in preparing to perform and in performing the terminated portion of the Work and in terminating the Contractor’s performance, plus a fair and reasonable allowance for direct jobsite overhead and profit thereon (such profit shall not include anticipated profit or consequential damages); provided however, that if it appears that the Contractor would have not profited or would have sustained a loss if the entire Quotation would have been completed, no profit shall be allowed or included and the amount of compensation shall be reduced to reflect the anticipated rate of loss, if any;

(c) Reasonable costs of settling and paying claims arising out of the termination of subcontracts or orders pursuant to the initial Paragraph of this Article. These costs shall not include amounts paid in accordance with other provisions hereof.

The total sum to be paid the Contractor under this Article shall not exceed the total Quotation Sum, as properly adjusted, reduced by the amount of payments otherwise made, and shall in no event include duplication of payment.

28. TERMINATION OF CONTRACT FOR CAUSE

If the Contractor should be adjudged as bankrupt, or if he should make a general assignment for the benefit of his creditors, or if a receiver should be appointed on account of his insolvency or, if the Contractor does not perform the Work, or any part thereof, in a timely manner, supply adequate labor, supervisory personnel or proper equipment or materials, or if it fails to timely discharge its obligations for labor, equipment and materials, or proceeds to disobey applicable law, or otherwise commits a violation of a material provision of the resulting Quotation, then the Owner, in addition to any other rights it may have against the Contractor or others, may terminate the performance of the Contractor upon ten (10) days written notice by registered mail of declaration of default and assume possession of the Project site and of all materials and equipment at the site and may complete the Work. In such case, the Contractor shall not be paid further until the Work is complete. After final completion has been achieved, if any portion of the Solicitation Sum, as it may be modified hereunder, remains after the cost to the owner of completing the Work, including all costs and expenses of every nature incurred, has been deducted by the Owner, such remainder shall belong to the Contractor. Otherwise, the Contractor shall pay and make whole the Owner for such cost. This obligation for payment shall survive the termination of the Quotation.

In the event the employment of the Contractor is terminated by the Owner for cause pursuant to this Article and it is subsequently determined by a Court of competent jurisdiction that such termination was without cause, such termination shall thereupon be deemed a Termination for Convenience and the provisions of that Article shall apply.

29. CURE PROVISION

In reference to Termination for Default, the Commonwealth shall notify the contractor in writing at least 30 days prior to the proposed termination date of the default. Such written notice shall specifically state the reason of the intention to terminate. The contractor shall have 30 days in which to cure the default, unless such cure period is extended by agreement of the parties. If the default is not cured to the satisfaction of the Commonwealth within the 30 day cure period or any extension thereof, the contract shall be considered terminated at close of business on the 30th day or any agreed upon extension.

30. CONTRACT CLAIMS

A question or act arising under the contract which is not disposed of by agreement may be brought to the Secretary of the Finance and Administration Cabinet pursuant to KRS 45A.230.

Pursuant to KRS 45A.245 and 45A.260 (2), actions on the contract shall be brought in Franklin Circuit Court, Frankfort, Kentucky within one year from the date of completion specified in the contract, notwithstanding the requirement to present contract claims to the Secretary of the Finance and Administration Cabinet for administrative review. Damages shall be limited to the original amount of the contract. The Contract shall be construed according to the laws of the Commonwealth of Kentucky.

Pending final determination of any dispute or legal action, the Contractor shall proceed diligently with the performance of the contract and in accordance with the Secretary of the Finance and Administration Cabinet’s direction.

31. INSURANCE

The Contractor shall furnish the Owner with certificates evidencing the required insurance coverage prior to commencing work. Contractor shall keep up-to-date copies of such certificates on file with Owner until work is completed. Owner may require Contractor to submit policy endorsements or complete policy copies of the required insurance.

Contractor shall procure and maintain for the duration of the contract insurance against claims for injuries to persons or damages to property which may arise from or in connection with the performance of the work hereunder by Contractor, its agents, representatives, employees or subcontractors.

Minimum Scope of Insurance Coverage shall be at least as broad as:

1) Insurance Services Office commercial general liability coverage (“occurrence” Form CG 0001, Ed.

10/93).

2) Insurance Services Office Form CA 0001 (Ed. 12/93) covering automobile liability, Code 1 “any auto.”

3) Workers’ compensation insurance as required by the Workers' Compensation Act (as contained in

KRS Chapter 342) and employers liability insurance.

Minimum Limits of Insurance Contractor shall maintain limits no less than:

1) Commercial General Liability:

$1,000,000 combined single limit per occurrence for bodily injury, personal injury and property damage with a $3,000,000 annual aggregate.

2) Automobile Liability: $500,000 combined single limit per accident for bodily injury and property damage.

3) Workers’ Compensation and Employers Liability: Workers’ compensation with statutory benefits without limit, as required by the Kentucky Workers Compensation Act, and employers liability limits of $1,000,000 per accident.

Other Insurance Provisions The policies are to contain, or be endorsed to contain, the following provisions:

Commercial General Liability and Automobile Liability Coverages.

1) Owner, its officers and employees are to be covered as insureds as respects: liability arising out of activities performed by or on behalf of the Contractor; general supervision of the work by Owner;

products and completed operations of the Contractor; premises owned, occupied or used by the Contractor, or automobiles owned, leased, hired or borrowed by the Contractor. The coverage shall contain no special limitations on the scope of protection afforded to Owner, its officers or employees.

2) The Contractor’s insurance coverage shall be primary insurance as respects Owner, its officers and employees. Any insurance of self-insurance maintained by Owner shall be excess of the Contractor’s insurance and shall not contribute to it.

3) Any failure to comply with reporting provisions of the policies shall not affect coverage provided to

Owner, its officers or employees.

4) The Contractor’s insurance shall apply separately to each insured against whom claim is made or suit is brought except with respect to the limits of the insurer’s liability.

All Coverages. Each insurance policy required by this clause shall be endorsed to state that coverage shall not be suspended, voided, canceled by either party, reduced in coverage or in limits except after thirty (30) days’ prior written notice by certified mail, return receipt requested, has been given to Owner.

Acceptability of Insurers Insurance is to be placed with insurers with an A.M. Best’s rating of no less than A VII, authorized to write insurance in the Commonwealth of Kentucky.

Verification of Coverage The Contractor shall furnish the Owner with certificates evidencing the required insurance coverage prior to commencing work. Contractor shall keep up-to-date copies of such certificates on file with Owner until work is completed. Owner may require Contractor to submit policy endorsements or complete policy copies of the required insurance.

Subcontractors Contractor shall include all subcontractors as insureds under its policies or shall furnish separate certificates and endorsements for each subcontractor. All coverages for subcontractors shall be subject to all of the requirements stated herein.

The Contractor shall provide all Risks Insurance in an amount of not less than one hundred percent (100%) of the insurable value of all the work. The coverage, is to be written on CP00200695 or equivalent acceptable to the Commonwealth. All coinsurance clauses in the Risks Insurance policy will be waived. All rights of subrogation against the Owner (i.e. the Commonwealth) will be waived by the insurer. Such insurance shall be for the benefit of the Contractor, Owner and any Subcontractor engaged on this project, as the Owner shall find their respective interest may appear. The Risks Insurance must be dated and in force on the date indicated in the Contract to begin work.

The insurance coverage required by the contract documents shall be in compliance with the laws of the Commonwealth of Kentucky and shall be placed with a licensed resident or non-resident agent who represents insurance companies authorized to do business in Kentucky.

The Certificate of Insurance or Certificates of Insurance will have the following endorsements as an attachment to the Certificate or Certificates:

(1) The Commonwealth of Kentucky, Division of Engineering and Contract Administration will be named as an additional insured.

(2) The policy is primary coverage and any insurance or self-insurance maintained by the

Commonwealth of Kentucky shall be excess.

(3) Any failure of the named insured to comply with the reporting provisions of the policy shall not affect coverage provided to the Commonwealth of Kentucky, it’s officers or employees.

(4) All Coverages. Each insurance policy required by this clause shall be endorsed to state that coverage shall not be suspended, voided, cancelled by either party, reduced in coverage or in limits except after thirty (30) days’ prior written notice by certified mail, return receipt requested, has been given to Owner.

31. NONDISCRIMINATION IN EMPLOYMENT

During the performance of the Contract, the Contractor agrees as follows:

The Contractor shall not discriminate against any employee or applicant for employment because of race, color, religion, sex, age, national origin, or disability in employment.

The Contractor will take affirmative action in regard to employment, upgrading, demotion, transfer, recruitment, recruitment advertising, layoff, termination, rates of pay or other forms of compensation, and selection for training, so as to ensure that applicants are employed and that employees during employment are treated without regard to their race, color, religion, sex, age, or national origin; however, when layoffs occur, employees shall be laid off according to seniority with the youngest employees being laid off first. When employees are recalled, this shall be done in the reverse way the employees were laid off;

The Contractor shall, in all solicitations or advertisements for employees placed by or on behalf of the Contractor, state that all qualified applicants will receive consideration for employment without regard to race, color, religion, sex, age, or national origin;

The Contractor will post notices in conspicuous places, available to employees and applicants for employment, setting forth the provisions of the nondiscrimination clauses required by this section;

The Contractor shall send to each labor union or representatives of workers with which he has a collective bargaining agreement or other contract or understanding, a notice advising the labor union or workers’ representatives of the Contractor’s commitments under this section.

Failure to comply with the above nondiscrimination clause constitutes material breach of Contract.

32. AFFIRMATIVE ACTION; REPORTING REQUIREMENTS

The Contractor and Subcontractors are exempt from any affirmative action or reporting requirements, under the Kentucky Equal Employment Act of 1978, KRS 45.560 to 45.640 hereinafter referred to as The Act, if any of the following conditions are applicable:

(1) the Contract or subcontract awarded is in the amount of two hundred and fifty thousand dollars

($250,000) or less, and the amount of the contract is not a subterfuge to avoid compliance with the provisions of The Act; or

(2) the Contractor or Subcontractor utilizes the services of fewer than eight (8) employees during the course of the Contract ; or

(3) the Contractor or subcontractor employs only family members or relatives; or

(4) the Contractor or Subcontractor employs only persons having a direct Ownership interest in the business and such interest in not a subterfuge to avoid compliance with the provisions of The Act.

The Contractor or Subcontractor not otherwise exempted shall for the duration of the Contract, hire minorities from within the drawing area to satisfy the agreed upon goals and timetables set out in addenda to the Contract. Should the union with which the Contractor has collective bargaining agreements be unwilling to provide sufficient minorities to satisfy the goals and timetables, the Contractor shall hire minorities from other sources within the drawing area to satisfy the goals and timetables in the addenda to the Contract.

The equal employment provisions of The Act may be met in part by the Contractor subcontracting to a minority contractor or subcontractor . A minority contractor or subcontractor shall be defined by the addenda to this Contract, or if none, by the Act.

Each Contractor shall, for the length of the Contract, furnish such information as required by The Act and by such rules, regulations and orders issued pursuant thereto and will permit access to all books and records pertaining to his employment practices and work sites by the contracting agency and the department for purposes of investigation to ascertain compliance with The Act and such rules, regulations and orders issued pursuant thereto.

If the Contractor is found to have committed an unlawful practice against a provision of The Act during the course of performing under this Contract, (if covered by The Act), the Owner may cancel or terminate the Contract, conditioned upon a program for future compliance approved by the Owner. The Owner may also declare such Contractor ineligible to bid on further contracts until such time as the Contractor complies in full with the requirements of The Act.

The Contractor shall not be required to terminate an existing employee, upon proof that employee was employed prior to the date of the Contract nor hire anyone who fails to demonstrate the minimum skills required to perform a particular job.

33. CONFLICT OF INTEREST PROHIBITED

The contractor represents and warrants, and the Commonwealth relies upon such representation and warranty, that it presently has no interest and shall not acquire any interest, direct or indirect, which would conflict in any manner or degree with the performance of its services. The contractor further represents and warrants that in the performance of the contract, no person, including any Subcontractor, having any such interest shall be employed.

In accordance with KRS 45A.340 and KRS 11A.040(4), the contractor agrees that it shall not knowingly allow any official or employee of the Commonwealth who exercises any function or responsibility in the review or approval of the undertaking or carrying out of this contract to voluntarily acquire any ownership interest, direct or indirect, in the contractor prior to the completion of the contract.

34. EXECUTIVE BRANCH ETHICS REQUIREMENTS

Potential Contractors are notified of these requirements in the attached document “CURRENT OR

FORMER STATE EMPLOYEE SEEKING TO DO BUSINESS WITH THE STATE”

35. FILING OF PROTEST

The Secretary of the Finance and Administration Cabinet, or his designee, shall have authority to determine protests and other controversies of actual or prospective bidders or offerors in connection with the solicitation or selection for award of a contract.

Any actual or prospective bidder, offeror, or contractor who is aggrieved in connection with the solicitation or selection for award of a contract may file a protest with the Secretary of the Finance and Administration Cabinet. A protest or notice of other controversy must be filed promptly and in any event within two (2) calendar weeks after such aggrieved person knows or should have known of the facts giving rise thereto.

All protests or notices of other controversies must be in writing.

The Secretary of the Finance and Administration Cabinet shall promptly issue a decision in writing. A copy of that decision shall be mailed or otherwise furnished to the aggrieved party and shall state the reasons for the action taken.

The decision by the Secretary of the Finance and Administration Cabinet shall be final and conclusive.

36. REGISTRATION WITH THE SECRETARY OF STATE BY A FOREIGN ENTITY

Pursuant to KRS 45A.480(1)(b), an agency, department, office, or political subdivision of the Commonwealth of Kentucky shall not award a state contract to a person that is a foreign entity required by KRS 14A.9-010 to obtain a certificate of authority to transact business in the Commonwealth (“certificate”) from the Secretary of State under KRS 14A.9-030 unless the person produces the certificate within fourteen (14) days of the bid or proposal opening. Therefore, foreign entities should submit a copy of their certificate with their solicitation response. If the foreign entity is not required to obtain a certificate as provided in KRS 14A.9-010, the foreign entity should identify the applicable exception in its solicitation response. Foreign entity is defined within KRS 14A.1-070.

For all foreign entities required to obtain a certificate of authority to transact business in the Commonwealth, if a copy of the certificate is not received by the contracting agency within the time frame identified above, the foreign entity’s solicitation response shall be deemed non-responsive or the awarded contract shall be cancelled.

Businesses can register with the Secretary of State at https://secure.kentucky.gov/sos/ftbr/welcome.aspx http://www.lrc.ky.gov/KRS/014A09/010.PDF http://www.lrc.ky.gov/KRS/014A09/030.PDF http://www.lrc.ky.gov/KRS/014A09/010.PDF http://www.lrc.ky.gov/KRS/014A01/070.PDF https://secure.kentucky.gov/sos/ftbr/welcome.aspx

Rev. (12-06)

*** CURRENT OR FORMER STATE EMPLOYEE SEEKING ***

*** TO DO BUSINESS WITH THE STATE? ***

* YOU SHOULD KNOW ABOUT THESE LAWS. *

In the 1992 regular legislative session, the General Assembly passed Senate Bill 63 (codified as

KRS Chapter 11A), the Executive Branch Code of Ethics, which applies to current and, in part, former state officials and employees of the executive branch.

The Executive Branch Code of Ethics is intended to promote public confidence in the integrity of state government and to declare as public policy the idea that state employees should view their work as a public trust and not a way to obtain private benefits.

If you work for the executive branch of state government or worked for the executive branch of state government within the past year, or were elected to an executive branch term of office which expired within the past year, you may be subject to the prohibitions of the law.

1. CURRENT PUBLIC SERVANTS SEEKING TO DO BUSINESS WITH THE STATE:

KRS 11A.040(4) provides:

(4) A public servant shall not knowingly himself or through any business in which he owns or controls an interest of more than five percent (5%), or by any other person for his use or benefit or on his account, undertake, execute, hold, bid on, negotiate, or enjoy, in whole or in part, any contract, agreement, lease, sale, or purchase made, entered into, awarded, or granted by the agency by which he is employed or which he supervises, subject to the provisions of

KRS 45A.340. This provision shall not apply to:

(a) A contract, purchase, or good faith negotiation made pursuant to KRS Chapter 416 relating to eminent domain;

or

(b) Agreements which may directly or indirectly involve public funds disbursed through entitlement programs; or

(c) A public servant's spouse or child doing business with any state agency other than the agency by which the public servant is employed or which he supervises; or

(d) Purchases from a state agency that are available on the same terms to the general public or that are made at public auction; or

(e) Sales of craft items to a state park by interim state employees designated as craftspersons under KRS 148.257.

2. FORMER OFFICERS AND ELECTED OFFICIALS SEEKING TO DO BUSINESS WITH

THE STATE:

KRS 11A.040(6) provides:

(6) A former officer or public servant listed in KRS 11A.010(9)(a) to (g) shall not, within six (6) months of termination of his employment, knowingly by himself or through any business in which he owns or controls an interest of at least five percent (5%), or by any other person for his use or benefit or on his account, undertake, execute, hold, bid on, negotiate, or enjoy, in whole or in part, any contract, agreement, lease, sale, or purchase made, entered into, awarded, or granted by the agency by which he was employed. This provision shall not apply to a contract, purchase, or good faith negotiation made under KRS Chapter 416 relating to eminent domain or to agreements that may directly or indirectly involve public funds disbursed through entitlement programs. This provision shall not apply to purchases from a state agency that are available on the same terms to the general public or that are made at public auction. This provision shall not apply to former officers of the Department of Public Advocacy whose continued representation of clients is necessary in order to prevent an adverse effect on the client.

3. FORMER OFFICERS AND ELECTED OFFICIALS SEEKING EMPLOYMENT FROM

ENTITIES WHICH DO BUSINESS WITH THE STATE:

KRS 11A.040(7) provides:

(7) A present or former officer or public servant listed in KRS 11A.010(9)(a) to (g) shall not, within six (6) months following termination of his office or employment, accept employment, compensation, or other economic benefit from any person or business that contracts or does business with, or is regulated by, the state in matters in which he was directly involved during the last thirty-six (36) months of his tenure. This provision shall not prohibit an individual from returning to the same business, firm, occupation, or profession in which he was involved prior to taking office or beginning his term of employment, or for which he received, prior to his state employment, a professional degree or license, provided that, for a period of six (6) months, he personally refrains from working on any matter in which he was directly involved during the last thirty-six (36) months of his tenure in state government.

This subsection shall not prohibit the performance of ministerial functions, including but not limited to filing tax returns, filing applications for permits or licenses, or filing incorporation papers, nor shall it prohibit the former officer or public servant from receiving public funds disbursed through entitlement programs.

4. FORMER PUBLIC SERVANTS WHO SEEK TO ACT AS LOBBYISTS:

KRS 11A.040(8) provides:

(8) A former public servant shall not act as a lobbyist or lobbyist's principal in matters in which he was directly involved during the last thirty-six (36) months of his tenure for a period of one (1) year after the latter of:

(a) The date of leaving office or termination of employment; or

(b) The date the term of office expires to which the public servant was elected.

5. FORMER PUBLIC SERVANTS CONTEMPLATING REPRESENTATION OF A PERSON

OR BUSINESS BEFORE A STATE AGENCY:

KRS 11A.040(9) provides:

(9) A former public servant shall not represent a person or business before a state agency in a matter in which the former public servant was directly involved during the last thirty-six (36) months of his tenure, for a period of one

(1) year after the latter of:

(a) The date of leaving office or termination of employment; or

(b) The date the term of office expires to which the public servant was elected.

*** DEFINITIONS ***

"PUBLIC SERVANT" means:

(a) The Governor;

(b) The Lieutenant Governor;

(c) The Secretary of State;

(d) The Attorney General;

(e) The Treasurer;

(f) The Commissioner of Agriculture;

(g) The Auditor of Public Accounts; and

(h) All employees in the executive branch including officers as defined in KRS 11A.010(7) of this section and merit employees;

“OFFICER” means all major management personnel in the executive branch of state government, including the secretary of the cabinet, the Governor's chief executive officers, cabinet secretaries, deputy cabinet secretaries, general counsels, commissioners, deputy commissioners, executive directors, principal assistants, division directors, members and full-time chief administrative officers of the Parole Board, Board of Tax Appeals, Board of Claims, Kentucky Retirement Systems board of trustees, Public Service Commission, Worker's Compensation Board and its administrative law judges, the Kentucky Occupational Safety and Health Review Commission, the Kentucky Board of Education, the Council on Postsecondary Education, and any person who holds a personal service contract to perform on a full-time basis for a period of time not less than six (6) months a function of any position listed above.

“BUSINESS” means any corporation, limited liability corporation, partnership, limited liability partnership, sole proprietorship, firm, enterprise, franchise, association, organization, self-employed individual, holding company, joint stock company, receivership, trust, or any legal entity through which business is conducted for profit.

"DOES BUSINESS WITH" means contracting, entering into an agreement, leasing, or otherwise exchanging services or goods with a state agency in return for payment by the state, including accepting a grant, but not including accepting a state entitlement fund disbursement.

"DIRECTLY INVOLVED" means to work on personally or to supervise someone who works on personally.

"LOBBYIST" means any person employed as a legislative agent as defined in KRS 6.611(22) or any person employed as an executive agency lobbyist as defined in KRS 11A.201(8) as any person engaged to influence executive agency decisions or to conduct executive agency lobbying activity as one of his main purposes on a substantial basis.

"EXECUTIVE AGENCY LOBBYING ACTIVITY" means contacts made to promote, oppose, or otherwise influence the outcome of an executive agency decision by direct communication with an elected executive official, the secretary of any cabinet listed in KRS 12.250, any executive agency official, or a member of the staff of any one of the officials listed in this paragraph.

"REPRESENT" means to attend an agency proceeding, write a letter, or communicate with an employee of an agency on behalf of someone else.

IN CASE OF DOUBT, THE LAW PERMITS YOU TO REQUEST AN ADVISORY OPINION

FROM THE EXECUTIVE BRANCH ETHICS COMMISSION, #3 FOUNTAIN PLACE,

FRANKFORT, KENTUCKY 40601 (502) 564-7954.

Prepared by the

EXECUTIVE BRANCH ETHICS COMMISSION

December 2006