Part I – Bidding and Agreement Forms and Bonds

SPECIFICATIONS

PART I - BIDDING AND AGREEMENT FORMS AND BONDS

Title Page

1. Invitation to Bid 4

2. Instructions to Bidders 5

3. EPA Special Conditions 10

4. Scope of Work 38

5. Bid Forms

a. Bid 42

b. Bid Schedule(s) 44

c. Bid Summary 52

d. Bid Breakdown 53

e. Corporate Resolution 55

f. Bid Bond 56

g. Information Required of Bidder 57

h. Conflict of Interest Questionnaire 30

i. Statement of City Charter

Provision on Conflict of Interest 62

j. General Conditions of Bidding 63

5. Additional Forms and Insurance

a. Local Bidder Preference Policy 70

b. Local Bidder Consideration Claim Form 73

c. Attachment “B”- Insurance Verification 76

d. Workers Compensation Insurance 78

e. Insurance Requirement Affidavit 80

f. Minority Business Enterprise Policy 85

g. Schedule C (MBE Participation) 95

h. Certificate of Interested Parties Information 97

i. Certificate of Interested Parties Form 1295 98

j. House Bill 1295 Acknowledgement Form 99

k. House Bill 89 (HB89) Verification Form 100

6. Agreement and Bonds

a. Agreement 102

b. Performance Bond 104

c. Payment Bond 106

7. Contract Administration Forms

a. Notice of Award 109

b. Notice to Proceed 110

INVITATION TO BID

BID NO. WU1026-01

Sealed bids will be received online until 2:00 P.M. (CT), THURSDAY, OCTOBER 1, 2026, for furnishing all plans, administration, superintendence, labor, services, materials, materials, tools, equipment, supplies, transportation, utilities, and all other items and facilities necessary therefore, as provided in the Contract Documents for the construction of:

CITY OF BEAUMONT

HARRIOT STREET LIFT STATION REHABILITATION

This project is funded in part by the U.S. Environmental Protection Agency (EPA). Bidders must comply with all applicable federal requirements, including Davis-Bacon prevailing wage requirements, EPA Disadvantaged

Business Enterprise (DBE) requirements, Debarment and Suspension certification, Anti-Lobbying certification, and Build America, Buy America (BABA) provisions. Contract award will be made to the lowest responsive and responsible bidder.

Bids will be opened and publicly read in the City Council Chambers at City Hall. The City reserves the right to reject any or all bids, or to accept any bid or combination of bids deemed advantageous to it.

Bidders must submit an original Bid Bond, Cashier's Check, Certified Check or irrevocable Letter of Credit issued by a bank satisfactory to the Owner, payable without recourse to the order of the City of Beaumont in an amount not less than five (5) percent of the largest possible bid amount as a guaranty that the Bidder will enter into contract and execute bond and guaranty in the form provided within fourteen (14) calendar days after date of Notice of Award of the contract.

Bids without the required financial security deposit will not be considered.

A MANDATORY Pre-bid Conference will be held at 10:00 A.M. (CT), on WEDNESDAY, SEPTEMBER

23, 2026, in-person at 1350 Langham Rd, Beaumont, TX 77707 in the Water Utilities Department Conference Room and virtually on Microsoft Teams. Attendees may join by internet or phone call:

https://bit.ly/3TXP0rN +1 903-405-2009 Passcode: 276 803 088#

Attendance at the Pre-bid meeting is a prerequisite to bidding. Prior to the pre-bid conference, interested bidders should obtain forms of proposal, contract, bond, and specifications. No one will be allowed to enter the pre-bid virtually or in-person if arrival is later than 5 minutes after the designated time. Calls for any technical difficulties must be made prior to the meeting.

Bidding forms, specifications and all necessary information may be downloaded from the City’s e-bids platform at: https://beaumonttexas.ionwave.net/Login.aspx and on civcastusa.com. There is no cost to view the plans, and printing can be done through the websites. Sets of hard copies of bidding Documents will not be sold.

Bids must be submitted through the City’s e-bids platform at: https://beaumonttexas.ionwave.net/Login.aspx.

Vendors must register to submit a bid. Be advised, e-bids is the only option to submit bids to the City of Beaumont effective 8/1/23.

Please make sure to reference Bid Number: WU1026-01

CITY OF BEAUMONT, TEXAS, OWNER

By: Tina Broussard

City Clerk

FIRST LEGAL NOTICE PUBLICATION: SEPTEMBER 10, 2026

SECOND LEGAL NOTICE PUBLICATION: SEPTEMBER 17, 2026

https://bit.ly/3TXP0rN https://beaumonttexas.ionwave.net/Login.aspx file://///citybmtserver1/PW/Public%20Works/05-ENGINEERING_PROJECTS/2022-Projects/22.PW.001%20-%20Street%20Rehabilitation%20City%20Wide%20-%20Phase%20V/01-BID/01-BIDDING/civcastusa.com https://beaumonttexas.ionwave.net/Login.aspx

SECTION 0100

INSTRUCTIONS TO BIDDERS

DEFINED TERMS - Terms used in these Instructions to Bidders and the Invitation to Bid are defined in the

General Conditions. The term "Bidder" means one who submits a Bid directly to the Owner, as distinguished from a sub-bidder, who submits a Bid to a Bidder.

1. COMPETENCY OF BIDDERS –

1.1. In selecting the lowest, responsive, responsible Bidder, consideration will be given to:

1.1.1. the financial standing and ability of the Bidder to satisfactorily complete the job being bid;

1.1.2. the competence, judgment, skill, ability and capacity of the Bidder to perform the work in accordance with the terms and conditions of the specification;

1.1.3. the past experience of the municipality with the Bidder and the experience of the Bidder with other governmental entities.

1.2. In determining the best value for the municipality, the municipality may consider:

1.2.1 the purchase price;

1.2.2. the reputation of the bidder and of the bidder’s goods or services;

1.2.3. the quality of the bidder’s goods or services;

1.2.4 the extent to which the goods or services meet the municipality’s needs;

1.2.5. the bidder’s past relationship with the municipality;

1.2.6. the impact on the ability of the municipality to comply with laws and rules relating to contracting with historically underutilized businesses and nonprofit organizations employing persons with disabilities;

1.2.7. the total long-term cost to the municipality to acquire the bidder’s goods or services; and

1.2.8. any relevant criteria specifically listed in the request for bids or proposals.

2. DISQUALIFICATION OF BIDDERS - More than one Bid from an individual, firm, partnership, corporation, or association under the same or different names will not be considered. If the Owner believes that any Bidder is interested in more than one Bid for the Work contemplated, all Bids in which such Bidder is interested will be rejected. If the Owner believes that any collusion exists among the Bidders, all Bids will be rejected.

3. BIDDER'S EXAMINATION OF CONTRACT DOCUMENTS AND THE SITE

(a) It is the responsibility of each Bidder before submitting a Bid to examine the Contract Documents thoroughly; visit the site to become familiar with local conditions that may affect cost, progress, or performance of the Work; consider federal, state, and local laws and regulations that may affect cost, progress, or performance of the Work; study and carefully correlate the Bidder's observations with the Contract Documents; and notify the Engineer of any and all conflicts, errors, or discrepancies found in the Contract Documents.

(b) Reference is made to the Supplementary General Conditions for identification of those reports of explorations and tests of subsurface conditions at the site which have been utilized by the Engineer in the preparation of the Contract Documents. The Bidder may rely upon the accuracy of the technical data contained in such reports; however, the interpretation of such technical data, including any interpolation or extrapolation thereof, together with non-technical data, interpretations, and opinions contained therein or the completeness thereof is the responsibility of the Bidder.

(c) Copies of such reports and drawings will be made available for review by the Owner to any Bidder upon request if said reports and drawings are not bound herein. Those reports and drawings are not part of the Contract Documents, but the technical data contained therein upon which the Bidder is entitled to rely, as provided in the Supplementary General Conditions are incorporated therein by reference.

(d) Information and data reflected in the Contract Documents with respect to underground utilities at, or contiguous to, the site is based upon information and data furnished to the Owner and the Engineer by the owners of such underground utilities or others, and the Owner does not assume responsibility for the accuracy or completeness thereof unless it is expressly provided otherwise in the Supplementary General Conditions or the Section entitled "Protection of Existing Facilities" of the technical specifications.

(e) Provisions concerning responsibilities for the adequacy of data furnished to prospective Bidders on subsurface conditions, underground utilities and/or other physical conditions, and possible changes in the Contract Documents due to differing conditions appear in Article 4.2 of the General Conditions, (Physical Conditions).

(f) Before submitting a Bid, each Bidder will, at Bidder's own expense, make or obtain any additional examinations, investigations, explorations, tests, and studies and obtain any additional information and data which pertain to the physical conditions (surface, subsurface, and underground utilities) at, or contiguous to, the site or otherwise which may affect cost, progress, or performance of the Work and which the Bidder deems necessary to determine its Bid for performing the Work in accordance with the time, price, and other terms and conditions of the Contract Documents.

(g) On request, in advance, the Owner will provide each Bidder access to the site to conduct such explorations and tests as each Bidder deems necessary for submission of a Bid. The Bidder shall fill all holes and shall clean up and restore the site to its former condition upon completion of such exploration and tests.

(h) The lands upon which the Work is to be performed, rights-of-way and easements for access thereto, and other lands designated for use by the Contractor in performing the Work are identified in the Contract Documents. All additional lands and access thereto required for temporary construction facilities or storage of materials and equipment are to be provided by the Contractor. Easement for permanent structures or permanent changes in existing structures is to be obtained and paid for by the Owner unless otherwise provided in the Contract Documents.

(i) The submission of a Bid will constitute an incontrovertible representation by the Bidder that the Bidder has complied with every requirement of Item #3 General Conditions, herein, entitled:

"Bidder's Examination of Contract Documents and the Site," that without exception the Bid is premised upon performing the Work required by the Contract Documents and such means, methods, techniques, sequences, or procedures of construction as may be indicated in or required by the Contract Documents, and that the Contract Documents are sufficient in scope and detail to indicate and convey understanding of all the terms and conditions for performance of the Work.

4. INTERPRETATIONS - All questions about the meaning or intent of the Contract Documents are to be directed to the Engineer. Interpretations or clarifications considered necessary by the Engineer in response to such questions will be resolved by the issuance of Addenda mailed or delivered to all parties recorded by the Engineer or Owner as having received the Contract Documents. Questions must be received six (6) days prior to the date of opening Bids no exceptions. Only questions that have been resolved by formal written Addenda will be binding. Oral and other interpretations or clarifications will be without legal effect.

5. BID SECURITY, BONDS, AND INSURANCE - Each Bid shall be accompanied by a certified or cashier's check or approved Bond in the amount stated in the Invitation to Bid. Said check or bond or letter of credit shall be made payable to the Owner and shall be given as a guarantee that the Bidder, if awarded the Work, will enter into an Agreement with the Owner, and will furnish the necessary insurance certificates, Payment Bond, and Performance Bond within fourteen (14) days; each of said bonds to be in the amount stated in the Supplementary General Conditions. In case of refusal or failure to enter into said Agreement, the check or Bid Bond, as the case may be, shall be forfeited to the Owner. If the Bidder elects to furnish a Bid Bond as its security, the Bidder shall use the Bid Bond form bound herein, or one conforming substantially to it in form. Builders Risk Insurance is required for this project.

6. RETURN OF BID SECURITY - Within 14 calendar days after award of the contract, the Owner will return all bid securities accompanying each of the Bids that are not considered in making the award. All other Bid securities will be held until the Agreement has been finally executed. They will then be returned to the respective Bidders whose Bids they accompany if not accepted for Contract agreement.

7. BID FORM – The bid schedule shall be completed and submitted through IONWAVE with your bid submittal.

8. SUBMISSION OF BIDS - ATTENTION! E-BIDS WILL BE THE ONLY OPTION TO SUBMIT

BIDS EFFECTIVE 8/1/2023. Bids will not be accepted by hard copy in person, or by mail, courier, or fax after 8/1/2023.

A valid copy of the Bid Bond with a visible seal shall be submitted electronically along with the bid by the time stipulated in the Invitation to Bid. After the Bid Opening and upon request by the Owner, the original Bid Bond or Security shall be submitted in a sealed envelope and shall be plainly marked in the upper left-hand corner with the name and address of the Bidder and shall bear the words "BID FOR," followed by the title of the Contract Documents for the Work, and the date and hour of opening of bids as indicated in the Invitation to Bid. The envelope enclosing the sealed original Bid Bond or Security shall be addressed to the City of Beaumont Water Utilities Department and shall be delivered or mailed to 1350 Langham Road, Beaumont, Texas 77707 before a recommendation for award shall be made.

9. IDENTIFICATION OF UNIT PRICES - All lump sum and unit prices must be stated in both printed words and figures. The Owner reserves the right to reject any and all bids and to waive any informality in bids received. Bids will be compared on the basis of the Engineer's estimate of the quantities of the various items of Work as shown on the Bid Schedule(s). Only such plans, specifications, and items of Work as are appropriate shall apply to the Work bid on.

10. DISCREPANCIES IN BIDS - In the event that there is more than one Bid Item in the Bid Schedule, the Bidder shall furnish a price for all Bid Items in the schedule, and failure to do so will render the Bid as non-responsive and may cause its rejection. Subtotal prices must be shown on the Bid Summary and total contract price must be shown in both words and figures. In the event of a discrepancy between the written and number amounts, the number will prevail.

11. QUANTITIES OF WORK - The quantities of work or material stated in unit price items of the Bid are supplied only to give an indication of the general scope of the Work; the Owner does not expressly or by implication agree that the actual amount of work or material will correspond therewith, and reserves the right after award to increase or decrease the quantity of any unit price item of the Work by an amount up to and including 20 percent of any Bid Item, without a change in the unit price, and shall include the right to delete any Bid Item in its entirety, or to add additional Bid Items up to and including an aggregate total amount not to exceed 20 percent of the Contract Price, without formal, authorized Change Order to the Contract.

12. WITHDRAWAL OF BID - The Bid may be withdrawn by the Bidder by means of a written request, signed by the Bidder or its properly authorized representative. Such written request must be delivered to the place stipulated in the Invitation to Bid prior to the scheduled closing time for receipt of Bids.

13. MODIFICATIONS AND UNAUTHORIZED ALTERNATIVE BIDS - Unauthorized conditions, limitations, or provisions attached to the Bid will render it informal and may cause its rejection as being non-responsive. The completed Bid forms shall be without interlineations, alterations, or erasures.

Alternative Bids will not be considered unless expressly called for and if supplied, without request, will be considered as additional bids and will be judged non-responsive and therefore rejected. Oral, telegraphic, facsimile or telephone Bids or modifications will not be considered.

14. LIQUIDATED DAMAGES - Provisions for liquidated damages, if any, are set forth in the Agreement.

15. SUBSTITUTE OR "OR-EQUAL" ITEMS - The Work, if awarded, will be on the basis of materials and equipment described in the Drawings or specified in the Technical Specifications without consideration of possible substitute or "or-equal" items. Whenever it is indicated in the Drawings or specified in the Technical Specifications that a substitute or "or-equal" item of material or equipment may be furnished or used by the Contractor if acceptable to the Engineer, application for such acceptance will not be considered by the Engineer until after the Effective Date of the Agreement. The procedure for submittal of any such application by the Contractor and consideration by the Engineer is set forth in Section entitled: "Contractor Submittals" of the Technical Specifications.

16. AWARD OF CONTRACT - Award of Contract, if awarded, may be awarded either to the lowest responsible Bidder or to the bidder who provides goods or services at the best value for the municipality, and will be made to a responsible, responsive Bidder whose Bid complies with all the requirements prescribed. Unless otherwise indicated, a single award will not be made for less than all the Bid Items of an individual Bid Schedule. In the event the Work is identified in more than one Bid Schedule, the Owner may award schedules individually or in combination. In the case of 2 or more Bid Schedules which are alternative to each other, only one of such alternative schedules will be awarded. The City may reject any and all bids.

17. EXECUTION OF AGREEMENT - The Bidder to whom award is made shall execute a written Agreement with the Owner on the form provided, shall secure all insurance documents specified, and shall furnish all certificates and bonds required by the Contract Documents within fourteen (14) calendar days after receipt of the Agreement forms from the Owner. Failure or refusal to enter into an Agreement as herein provided or to conform to any of the stipulated requirements in connection therewith shall be just cause for an annulment of the award and forfeiture of the Bid Security. If the lowest responsive, responsible Bidder refuses or fails to execute the Agreement, the Owner may award the Contract to the second lowest responsive, responsible Bidder. If the second lowest responsive, responsible Bidder refuses or fails to execute the Agreement, the Owner may award the Contract to the third lowest responsive, responsible Bidder. On the failure or refusal of such second or third lowest Bidder to execute the Agreement, each such Bidder's Bid Securities shall be likewise forfeited to the Owner. Upon failure or refusal of any Bidder to execute the agreement when notified of award, the owner may at its option, reject all bids and call for total or partial rebidding of the project.

18. WORKER'S COMPENSATION REQUIREMENT - The Bidder should be aware that in accordance with laws of the State of Texas, the Bidder will, if awarded the Contract, be required to secure the payment of compensation to its employees and execute the Worker's Compensation Certification.

19. WAGE RATE REQUIREMENTS - Attention is called to the fact that there must be paid on this project not less than the prevailing Highway-Heavy, Municipal and Utilities wage rates for Jefferson County or, as applicable, wage rates for Federally Funded Construction Projects. Wage rates as of May 18, 2026, are set out in the contract documents, and are subject to revisions. It shall be the duty of the Contractor to keep posted on all the latest revisions. Also, qualifications being equal, citizens of the City of Beaumont shall be given preference in employment by any Contractor doing work for the City under contract. This is in accordance with Article XVII, Section 7, Page 40 of the Charter of the City of Beaumont, Texas, as adopted on December 6, 1947, which is as follows:

“Section 7 – Citizens Given Preference in Employment: Except as herein otherwise provided, qualifications being equal, citizens of Beaumont shall be given preference in employment by the City as well as by any contractor doing work for the City under contract, and such contractors shall pay the prevailing rate of wages paid for the class of work done; and qualifications, prices and quality of material being equal, citizens of Beaumont shall be given preference in awarding of all contracts over which the City has jurisdiction, provided that this section shall not interfere with the system of purchasing supplies for the various departments by competitive bidding.”

20. H.B. 1295 COMPLIANCE Texas Ethics Commission Certificate Number -The Awarded Vendor for the contract shall comply with the requirements of Section 2252.908 of the Texas Government Code as adopted in 2015 as House Bill 1295. The law requires that a governmental entity may not enter in certain contracts with a business entity unless the business entity submits a Disclosure of Interested Parties to the governmental entity. The law applies only to a contract that either (1) requires an action or vote by the governing body of the entity or agency before the contract may be signed or (2) has a value of at least $1 million. Compliance with the law requires that the awarded Vendor utilize the Texas Ethics Commission website to enter the required information on Form 1295 and print a copy of the complete form. The form must be signed, notarized and submitted to the contracting government entity. The City of Beaumont, in the case of contracts formalized by Purchase Order or by other written contract, will notify the Vendor of Award by Council and request the completed Form 1295 within fourteen (14) calendar days thereafter.

21. H.B. 89 COMPLIANCE – Verification - The Awarded Vendor for the contract shall comply with the requirements of Senate Bill 252 Ch. 2252 Certification: Texas Government Code, Chapter 2252, Section

2252.152 and Section 2252.153 of the Texas Government Code as adopted in 2017 as House Bill 89

(HB89).

The law requires that a governmental entity may not enter in certain contracts with a business entity unless the business entity submits an executed HB89 Compliance form to the governmental entity. Compliance with the law requires that the awarded Vendor must sign, notarize and submit the HB89 Form to the contracting governmental entity. The City of Beaumont, in the case of contracts formalized by Purchase Order or by other written contract, will notify the Vendor of Award by Council and request the completed HB89 within fourteen (14) calendar days thereafter.

22. PROJECTMATES REQUIREMENT – The Awarded Vendor will be required to use Projectmates software throughout the life of this project from award to closeout. The City will provide a license to be used by the Awarded Vendor at no cost.

Projectmates by Systemates, Inc., is a construction management tool that allows users to manage the entire project life cycle from concept to closeout. All RFI’s, Schedules, Daily Reports, Change Orders, Pay Requests, and any procedures related to contract management will be processed through Projectmates.

The City reserves the right to rescind an award from a Vendor who refuses to use Projectmates during the life of the project. Such refusal will be noted and considered when awarding future projects.

END OF INSTRUCTIONS TO BIDDERS

Revised: November 2025

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY

REGION 6

SUPPLEMENTAL GENERAL CONDITIONS

FOR

CONGRESSIONALLY DIRECTED SPENDING GRANT CONSTRUCTION

PROJECTS

EPA SPECIAL CONDITIONS

The attached instructions and regulations as listed below shall be incorporated into the

Specifications and comprise the EPA’s Special Conditions.

EPA Special Provisions Attachment Number 1

Requirements for Sub agreements Awarded by Prime Contractors Attachment Number 2

2 CFR 200 (Procurement) Attachment Number 3

Labor Standards Provisions for Federally Assisted Construction Attachment Number 4

Inadvertent Discoveries Attachment Number 5

Certifications

Debarment, Suspension and Other Responsibility Matters Attachment Number 6

Anti-lobbying Attachment Number 7

Region 6 Disadvantaged Business Enterprise (DBE) Attachment Number 8

Bonds and Insurance Attachment Number 9

Build America, Buy America (BABA) Attachment Number 10

American Iron and Steel (AIS) Attachment Number 11

Attachment Number 1

EPA SPECIAL PROVISIONS

a) The construction of the project shall conform to the applicable requirements for state, territorial and local laws and ordinances to the extent that such requirements do not conflict with Federal laws.

b) The EPA shall have access to the site and the project.

c) Any contract(s) awarded under this invitation for Bids are expected to be funded in part by a grant from the U.S. Environmental Protection Agency. Neither the United States nor any of its departments, agencies or employees are or will be a part to this Invitation for Bids or any resulting contract.

d) The “Method of Award” is to the lowest responsible responsive bidder.

e) A statement that the bidder must make positive efforts to use Disadvantaged Business

Enterprises.

Attachment Number 2

REQUIREMENTS FOR SUBAGREEMENTS

AWARDED BY A PRIME CONTRACTOR

A contractor must comply with the following provisions in its award of subagreements. (This section does not apply to a supplier’s procurement of materials to produce equipment, materials and catalog, off-the-shelf, or manufactured items.)

a) 2 CFR 200.213 (Debarment and Suspension Under EPA Assistance Programs);

b) The limitations and sub-agreement award in 2 CFR 200.92 and 2 CFR 200.330-332;

c) The requirement for small, small rural, minority, women’s and labor surplus area business in 2 CFR 200.321;

d) The specifications requirements of 2 CFR 200;

e) The Federal cost principles in 2 CFR 200.400-475;

f) The prohibited types of sub-agreements in 2 CFR 200.323(d); and

g) 2 CFR 200.450 (Anti-Lobbying under EPA Assistance Programs).

Attachment Number 3

2 CFR 200 (PROCUREMENT)

Title 2: Grants and Agreements

Part 200 – Uniform Administrative Requirements, Cost Principles, and Audit Requirements for

Federal Awards

Subpart D – Post Federal Award Requirements

Procurement Standards

§200.317 Procurements by states.

When procuring property and services under a Federal award, a state must follow the same policies and procedures it uses for procurements from its non-Federal funds. The state will comply with §200.322 Procurement of recovered materials and ensure that every purchase order or other contract includes any clauses required by section §200.326 Contract provisions. All other non-Federal entities, including subrecipients of a state, will follow §§200.318 General procurement standards through 200.326 Contract provisions.

§200.318 General procurement standards.

(a) The non-Federal entity must use its own documented procurement procedures which reflect applicable State, local, and tribal laws and regulations, provided that the procurements conform to applicable Federal law and the standards identified in this part.

(b) Non-Federal entities must maintain oversight to ensure that contractors perform in accordance with the terms, conditions, and specifications of their contracts or purchase orders.

(c)(1) The non-Federal entity must maintain written standards of conduct covering conflicts of interest and governing the actions of its employees engaged in the selection, award and administration of contracts. No employee, officer, or agent may participate in the selection, award, or administration of a contract supported by a Federal award if he or she has a real or apparent conflict of interest. Such a conflict of interest would arise when the employee, officer, or agent, any member of his or her immediate family, his or her partner, or an organization which employs or is about to employ any of the parties indicated herein, has a financial or other interest in or a tangible personal benefit from a firm considered for a contract. The officers, employees, and agents of the non-Federal entity may neither solicit nor accept gratuities, favors, or anything of monetary value from contractors or parties to subcontracts. However, non-Federal entities may set standards for situations in which the financial interest is not substantial, or the gift is an unsolicited item of nominal value. The standards of conduct must provide for disciplinary actions to be applied for violations of such standards by officers, employees, or agents of the non-Federal entity.

(2) If the non-Federal entity has a parent, affiliate, or subsidiary organization that is not a state, local government, or Indian tribe, the non-Federal entity must also maintain written standards of conduct covering organizational conflicts of interest. Organizational conflicts of interest means that because of relationships with a parent company, affiliate, or subsidiary organization, the non-Federal entity is unable or appears to be unable to be impartial in conducting a procurement action involving a related organization.

(d) The non-Federal entity's procedures must avoid acquisition of unnecessary or duplicative items. Consideration should be given to consolidating or breaking out procurements to obtain a more economical purchase. Where appropriate, an analysis will be made of lease versus purchase alternatives, and any other appropriate analysis to determine the most economical approach.

(e) To foster greater economy and efficiency, and in accordance with efforts to promote cost-effective use of shared services across the Federal Government, the non-Federal entity is encouraged to enter into state and local intergovernmental agreements or inter-entity agreements where appropriate for procurement or use of common or shared goods and services.

(f) The non-Federal entity is 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) The non-Federal entity is encouraged to use value engineering clauses in contracts for construction projects of sufficient size to offer reasonable opportunities for cost reductions.

Value engineering is a systematic and creative analysis of each contract item or task to ensure that its essential function is provided at the overall lower cost.

(h) The non-Federal entity must award contracts 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. See also §200.213 Suspension and debarment.

(i) The non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to the following:

rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price.

(j) (1) The non-Federal entity may use a time and materials type contract only after a determination that no other contract is suitable and if the contract includes a ceiling price that the contractor exceeds at its own risk. Time and materials type contract means a contract whose cost to a non-Federal entity is the sum of:

(i) The actual cost of materials; and

(ii) Direct labor hours charged at fixed hourly rates that reflect wages, general and administrative expenses, and profit.

(2) Since this formula generates an open-ended contract price, a time-and-materials contract provides no positive profit incentive to the contractor for cost control or labor efficiency. Therefore, each contract must set a ceiling price that the contractor exceeds at its own risk. Further, the non-Federal entity awarding such a contract must assert a high degree of oversight in order to obtain reasonable assurance that the contractor is using efficient methods and effective cost controls.

(k) The non-Federal entity alone must 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 non-Federal entity of any contractual responsibilities under its contracts. The Federal awarding agency will not substitute its judgment for that of the non-Federal entity unless the matter is primarily a Federal concern. Violations of law will be referred to the local, state, or Federal authority having proper jurisdiction.

[78 FR 78608, Dec. 26, 2013, as amended at 79 FR 75885, Dec. 19, 2014; 80 FR 43309, July 22, 2015]

§200.319 Competition.

(a) All procurement transactions must be conducted in a manner providing full and open competition consistent with the standards of this section. In order to ensure objective contractor performance and eliminate unfair competitive advantage, contractors that develop or draft specifications, requirements, statements of work, or invitations for bids or requests for proposals must be excluded from competing for such procurements. 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 contracts 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 or other relevant requirements of the procurement; and

(7) Any arbitrary action in the procurement process.

(b) The non-Federal entity must conduct procurements in a manner that prohibits the use of statutorily or administratively imposed state, local, or tribal 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 this section preempts state licensing laws. When contracting for architectural and engineering (A/E) services, geographic location may be a selection criterion provided its application leaves an appropriate number of qualified firms, given the nature and size of the project, to compete for the contract.

(c) The non-Federal entity must have written procedures for procurement transactions.

These procedures must 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 description must 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, must 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 equivalent” description may be used as a means to define the performance or other salient requirements of procurement. The specific features of the named brand which must be met by offers must 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) The non-Federal entity must ensure that all pre-qualified lists of 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, the non-Federal entity must not preclude potential bidders from qualifying during the solicitation period.

[78 FR 78608, Dec. 26, 2013, as amended at 79 FR 75885, Dec. 19, 2014]

§200.320 Methods of procurement to be followed.

The non-Federal entity must use one of the following methods of procurement.

(a) Procurement by micro-purchases. Procurement by micro-purchase is the acquisition of supplies or services, the aggregate dollar amount of which does not exceed the micro-purchase threshold (§200.67 Micro-purchase). To the extent practicable, the non-Federal entity must distribute micro-purchases equitably among qualified suppliers. Micro-purchases may be awarded without soliciting competitive quotations if the non-Federal entity considers the price to be reasonable.

(b) 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. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources.

(c) 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 the lowest in price. The sealed bid method is the preferred method for procuring construction, if the conditions in paragraph (c)(1) of this section apply.

(1) In order for sealed bidding to be feasible, the following conditions should be present:

(i) A complete, adequate, and realistic specification or purchase description is available;

(ii) Two or more responsible bidders are willing and able to compete effectively for the business; and

(iii) 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.

(2) If sealed bids are used, the following requirements apply:

(i) Bids must be solicited from an adequate number of known suppliers, providing them sufficient response time prior to the date set for opening the bids, for local, and tribal governments, the invitation for bids must be publicly advertised;

(ii) The invitation for bids, which will include any specifications and pertinent attachments, must define the items or services in order for the bidder to properly respond;

(iii) All bids will be opened at the time and place prescribed in the invitation for bids, and for local and tribal governments, the bids must be opened publicly;

(iv) A firm fixed price contract award will be made in writing to the lowest responsive and responsible bidder. Where specified in bidding documents, factors such as discounts, transportation cost, and life cycle costs must 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; and

(v) Any or all bids may be rejected if there is a sound documented reason.

(d) Procurement by competitive proposals. The technique of competitive proposals is normally 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 must be publicized and identify all evaluation factors and their relative importance. Any response to publicized requests for proposals must be considered to the maximum extent practical;

(2) Proposals must be solicited from an adequate number of qualified sources;

(3) The non-Federal entity must have a written method for conducting technical evaluations of the proposals received and for selecting recipients;

(4) Contracts must be awarded to the responsible firm whose proposal is most advantageous to the program, with price and other factors considered; and

(5) The non-Federal entity 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) [Reserved]

(f) Procurement by noncompetitive proposals. Procurement by noncompetitive proposals is procurement through solicitation of a proposal from only one source and may be used only when one or more of the following circumstances apply:

(1) The item is available only from a single source;

(2) The public exigency or emergency for the requirement will not permit a delay resulting from competitive solicitation;

(3) The Federal awarding agency or pass-through entity expressly authorizes noncompetitive proposals in response to a written request from the non-Federal entity; or

(4) After solicitation of a number of sources, competition is determined inadequate.

[78 FR 78608, Dec. 26, 2013, as amended at 79 FR 75885, Dec. 19, 2014; 80 FR 54409, Sept.

10, 2015]

§200.321 Contracting with small and minority businesses, women's business enterprises, and labor surplus area firms.

(a) The non-Federal entity must take all necessary affirmative steps to assure that minority businesses, women's business enterprises, and labor surplus area firms are used when possible.

(b) Affirmative steps must include:

(1) Placing qualified small and minority businesses and women's business enterprises on solicitation lists;

(2) Assuring that small and minority businesses, and women's business enterprises are solicited whenever they are potential sources;

(3) Dividing total requirements, when economically feasible, into smaller tasks or quantities to permit maximum participation by small and minority businesses, and women's business enterprises;

(4) Establishing delivery schedules, where the requirement permits, which encourage participation by small and minority businesses, and women's business enterprises;

(5) Using the services and assistance, as appropriate, of such organizations as the Small

Business Administration and the Minority Business Development Agency of the

Department of Commerce; and

(6) Requiring the prime contractor, if subcontracts are to be let, to take the affirmative steps listed in paragraphs (1) through (5) of this section.

§200.322 Domestic preferences for procurements

(a) The recipient or subrecipient should, to the greatest extent practicable and consistent with law, provide a preference for the purchase, acquisition, or use of goods, products, or materials produced in the United States (including but not limited to iron, aluminum, steel, cement, and other manufactured products). The requirements of this section must be included in all subawards, contracts, and purchase orders under Federal awards.

(b) For purposes of this section:

(1) “Produced in the United States” means, for iron and steel products, that all manufacturing processes, from the initial melting stage through the application of coatings, occurred in the United States.

(2) “Manufactured products” means items and construction materials composed in whole or in part of non-ferrous metals such as aluminum; plastics and polymer-based products such as polyvinyl chloride pipe; aggregates such as concrete; glass, including optical fiber; and lumber.

(c) Federal agencies providing Federal financial assistance for infrastructure projects must implement the Buy America preferences set forth in 2 CFR part 184.

§200.323 Procurement of recovered materials.

A non-Federal entity that is a state agency or agency of a political subdivision of a state and its contractors must comply with section 6002 of the Solid Waste Disposal Act, as amended by the https://www.ecfr.gov/current/title-2/part-184

Resource Conservation and Recovery Act. The requirements of Section 6002 include procuring only items designated in guidelines of the Environmental Protection Agency (EPA) at 40 CFR part 247 that contain the highest percentage of recovered materials practicable, consistent with maintaining a satisfactory level of competition, where the purchase price of the item exceeds

$10,000 or the value of the quantity acquired during the preceding fiscal year exceeded $10,000;

procuring solid waste management services in a manner that maximizes energy and resource recovery; and establishing an affirmative procurement program for procurement of recovered materials identified in the EPA guidelines.

[78 FR 78608, Dec. 26, 2013, as amended at 79 FR 75885, Dec. 19, 2014]

§200.324 Contract cost and price.

(a) The non-Federal entity must perform a cost or price analysis in connection with every procurement action in excess of the Simplified Acquisition Threshold including contract modifications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, the non-Federal entity must make independent estimates before receiving bids or proposals.

(b) The non-Federal entity must 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 must 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 the Federal award are allowable only to the extent that costs incurred or cost estimates included in negotiated prices would be allowable for the non-Federal entity under Subpart E—Cost Principles of this part. The non-Federal entity may reference its own cost principles that comply with the

Federal cost principles.

(d) The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used.

§200.325 Federal awarding agency or pass-through entity review.

(a) The non-Federal entity must make available, upon request of the Federal awarding agency or pass-through entity, technical specifications on proposed procurements where the

Federal awarding agency or pass-through entity believes such review is needed to ensure that the item or service specified is the one being proposed for acquisition. This review generally will take place prior to the time the specification is incorporated into a solicitation document. However, if the non-Federal entity desires to have the review accomplished after a solicitation has been developed, the Federal awarding agency or pass-through entity may still review the specifications, with such review usually limited to the technical aspects of the proposed purchase.

(b) The non-Federal entity must make available upon request, for the Federal awarding agency or pass-through entity pre-procurement review, procurement documents, such as requests for proposals or invitations for bids, or independent cost estimates, when:

(1) The non-Federal entity's procurement procedures or operation fails to comply with the procurement standards in this part;

(2) The procurement is expected to exceed the Simplified Acquisition Threshold and is to be awarded without competition or only one bid or offer is received in response to a solicitation;

(3) The procurement, which is expected to exceed the Simplified Acquisition Threshold, specifies a “brand name” product;

(4) The proposed contract 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

(5) A proposed contract modification changes the scope of a contract or increases the contract amount by more than the Simplified Acquisition Threshold.

(c) The non-Federal entity is exempt from the pre-procurement review in paragraph (b) of this section if the Federal awarding agency or pass-through entity determines that its procurement systems comply with the standards of this part.

(1) The non-Federal entity may request that its procurement system be reviewed by the

Federal awarding agency or pass-through entity to determine whether its system meets these standards in order for its system to be certified. Generally, these reviews must occur where there is continuous high-dollar funding, and third-party contracts are awarded on a regular basis;

(2) The non-Federal entity may self-certify its procurement system. Such self-certification must not limit the Federal awarding agency's right to survey the system.

Under a self-certification procedure, the Federal awarding agency may rely on written assurances from the non-Federal entity that it is complying with these standards.