contract no. lrt-08-109-fmso facilities …...facilities maintenance services sample contract july ,...

CONTRACT NO. LRT-08-109-FMSO

FACILITIES MAINTENANCE SERVICES

__________, 2008

Facilities Maintenance Services Sample Contract

July , 2008 of 65 Contract No. LRT-08-109-FMSO Revision 0

FACILITIES MAINTENANCE SERVICES CONTRACT

THIS CONTRACT (“Contract”) is made and entered into on ________________ by and between Valley Metro Rail, Inc., an Arizona non-profit corporation formed by the Cities of Phoenix, Tempe, Mesa and Glendale to engage in planning, designing, constructing and operating a light rail transit system, hereinafter called “Agency,” and [CONTRACTOR], hereinafter called the “Contractor.”

RECITALS

WHEREAS, the Agency requires the Contractor to provide Facilities Maintenance Services pursuant to the terms of this Contract, and

WHEREAS, the Contractor is considered qualified and capable to perform the Work required, as more specifically defined in herein.

NOW, THEREFORE, in consideration of the mutual promises contained herein, and the performance thereof, the Contractor and the Agency agree as follows:

CONTRACT

TABLE OF CONTENTS

SECTION 1 - GENERAL..........................................................................................................................7 1.0 ABBREVIATIONS.................................................................................................7 1.1 DEFINITIONS........................................................................................................7

SECTION 2 - CONTRACTUAL REQUIREMENTS................................................................................8 2.0 CONTRACT TYPE AND AMOUNT ......................................................................8 2.1 CONTRACT TERM ...............................................................................................8 2.2 OPTION TO EXTEND ...........................................................................................8 2.3 ANNUAL FUNDING..............................................................................................8 2.4 TIME OF THE ESSENCE......................................................................................9 2.5 INTENT OF CONTRACT/ORDER OF PRECEDENCE ........................................9 2.6 SEVERABILITY ....................................................................................................9 2.7 NOTICES AND COMMUNICATIONS...................................................................9

2.8 INSURANCE ..................................................................................................................................10 A. AGENCY PROVIDED INSURANCE...................................................................10 1. BODILY INJURY AND PROPERTY DAMAGE LIABILITY ................................10 2. PROPERTY INSURANCE ..................................................................................10

B. CONTRACTOR PROVIDED INSURANCE .............................................................................10 1. GENERAL PROVISIONS....................................................................................10


July, 2008 of 65 Contract No. LRT-08-109-FMSO Revision 0

2. WORKERS’ COMPENSATION AND EMPLOYERS LIABILITY INSURANCE .12 3. AUTOMOBILE LIABILITY INSURANCE............................................................12

2.9 INDEMNIFICATION .........................................................................................................................13 2.8 LIQUIDATED DAMAGES ( RESERVED) ...........................................................14 2.9 EXUSABLE DELAYS .........................................................................................14 2.10 SUSPENSION OF WORK...................................................................................15 2.11 TERMINATION FOR CONVENIENCE................................................................15 2.12 TERMINATION FOR DEFAULT .........................................................................18 2.13 STATUTORY RIGHT OF CANCELLATION FOR CONFLICT OF INTEREST ..19 2.14 CANCELLATION RIGHTS..................................................................................19 2.15 CLAIMS...............................................................................................................19 2.16 DISPUTES ..........................................................................................................21 2.17 APPLICABLE LAW AND JURISDICTION .........................................................21 2.18 ATTORNEYS’ FEES...........................................................................................21 2.19 AGENCY’S RIGHT TO INFORMATION .............................................................21 2.20 OTHER CONTRACTING RIGHTS......................................................................22 2.21 USE OF AGENCY LOGO ...................................................................................22 2.22 USE OF AGENCY’S NAME BY THE CONTRACTOR .......................................22 2.23 OWNERSHIP ......................................................................................................22 2.24 ORGANIZATION - EMPLOYMENT DISCLAIMER.............................................22 2.25 OFFSET FOR DAMAGES ..................................................................................23 2.26 CONTINUING OBLIGATIONS............................................................................23 2.27 COMPLIANCE WITH ENVIRONMENTAL LAWS ..............................................23 2.28 COMPLIANCE WITH LAWS AND REGULATIONS...........................................24 2.29 PROHIBITED INTERESTS .................................................................................25 2.30 PARAGRAPH HEADINGS AND OTHER TITLES..............................................25 2.31 AUDIT AND INSPECTION OF RECORDS.........................................................25 2.32 TAXES ................................................................................................................26 2.33 INTEGRATION AND MODIFICATION................................................................26 2.34 WAIVER AND NONWAIVER..............................................................................26 2.35 INTELLECTUAL PROPERTY.............................................................................26 2.36 AGENCY’S RIGHT TO ASSIGN AND NOVATION............................................26 2.37 AGENCY STANDARDS OF CONDUCT.............................................................27



SECTION 3 - SCOPE OF WORK..........................................................................................................27 3.0 RESPONSIBILITY OF THE CONTRACTOR......................................................27 3.1 CONTRACTOR'S STATUS AND GENERAL RESPONSIBILITIES...................28 3.2 AGENCY’S PROJECT MANAGER ....................................................................28 3.3 PROJECT KEY PERSONNEL............................................................................28 3.4 PERSONNEL ......................................................................................................29 3.5 NOTICE TO AGENCY OF LABOR DISPUTES..................................................30 3.6 AGENCY FURNISHED PROPERTY ..................................................................30 3.7 CHANGES IN EQUIPMENT PROVIDED............................................................31 3.8 CONTINUITY OF WORK ....................................................................................31 3.9 THIRD PARTY ACCESS TO EQUIPMENT AND PROPERTY ..........................31 3.10 PROCUREMENT OF EQUIPMENT, SPARE PARTS, MATERIALS AND

SUPPLIES...........................................................................................................32 3.11 REPORT OF ACCIDENTS..................................................................................32 3.12 EMERGENCIES..................................................................................................32 3.13 INSPECTION OF WORK ....................................................................................32 3.14 WARRANTIES ....................................................................................................33

SECTION 4 - CONTROL OF WORK....................................................................................................33 4.0 OPERATIONS AND MANAGEMENT.................................................................33 4.1 PARTNERING.....................................................................................................34 4.2 STANDARD WORK SCHEDULE .......................................................................35 4.3 INTERFERENCE WITH OPERATIONS..............................................................35 4.4 ASSIGNMENT AND SUBCONTRACTING.........................................................35 4.5 SUBSTITUTION OF SUBCONTRACTORS .......................................................35 4.6 CONSULTANT’S AUTHORITY ..........................................................................35 4.7 APPROVALS ......................................................................................................36 4.8 CONTRACT WORK HOURS..............................................................................36 4.9 CONTRACT ADMINISTRATION ........................................................................37 4.10 CONTRACT CLOSEOUT ...................................................................................37

SECTION 5 - PERFORMANCE AND PROGRESS.............................................................................38 5.0 CHANGES IN THE WORK .................................................................................38

SECTION 6 - PAYMENT........................................................................................................................39 6.0 COMPENSATION ...............................................................................................39



6.1 PAYMENT...........................................................................................................41 6.2 PROMPT PAYMENT...........................................................................................42 6.3 ACCOUNTING AND AUDITS.............................................................................42

SECTION 7 - FEDERAL AND OTHER LEGAL REQUIREMENTS....................................................42 7.0 FEDERAL REQUIREMETNS..............................................................................42 7.1 FEDERAL FUNDING LIMITATION.....................................................................42 7.2 CONTRACTOR LICENSE REQUIREMENT.......................................................43 7.3 BUY AMERICA ...................................................................................................43 7.4 CARGO PREFERENCE......................................................................................43 7.5 FLY AMERICA....................................................................................................44 7.6 ENERGY CONSERVATION ...............................................................................44 7.7 CLEAN WATER REQUIREMENTS....................................................................44 7.8 CLEAN AIR.........................................................................................................44 7.9 SUBSTANCE ABUSE.........................................................................................44 7.10 LABOR MANAGEMENT.....................................................................................45 7.11 DEBARRED CONTRACTOR AND SUBCONTRACTOR...................................45 7.12 LOBBYING .........................................................................................................46 7.13 FEDERAL CHANGES ........................................................................................52 7.14 RECYCLED PRODUCTS....................................................................................52 7.15 NO FEDERAL GOVERNMENT OBLIGATION TO THIRD PARTIES ................52 7.16 COMPLIANCE WITH THE IMMIGRATION REFORM AND CONTROL ACT OF

1986 (IRCA) REQUIRED ....................................................................................53 7.17 PROGRAM FRAUD AND FALSE OR FRAUDULENT STATEMENT AND

RELATED ACTS.................................................................................................53 7.18 PRIVACY ACT ....................................................................................................53 7.19 CIVIL RIGHTS.....................................................................................................54 7.20 INCORPORATION OF FEDERAL TRANSIT ADMINISTRATION TERMS........55 7.21 SERVICE CONTRACT ACT OF 1965 ................................................................55 7.22 CONTRACT WORK HOURS AND SAFETY STANDARDS ACT ......................63 7.23 COPELAND ANTI-KICKBACK ACT ..................................................................64 7.24 NATIONAL TRANSIT DATABASE REPORTING..............................................65



EXHIBITS EXHIBIT A SCOPE OF WORK

EXHIBIT B COST SCHEDULE

EXHIBIT C N/A

ATTACHMENTS ATTACHMENT A LIST OF SUBCONTRACTORS

ATTACHMENT B CERTIFICATION REGARDING DEBARMENT, SUSPENSION, AND OTHER RESPONSIBILITY MATTERS

ATTACHMENT C N/A

ATTACHMENT D N/A

ATTACHMENT E WAGE DETERMINATION - SERVICE CONTRACT ACT

END OF TABLE OF CONTENTS



SECTION 1 - GENERAL

1.0 ABBREVIATIONS

“ADOSH” The abbreviation “ADOSH” means Arizona Division of Occupational Safety and Health.

“AOSHA” The abbreviation “AOSHA” means Arizona Occupational Safety and Health Act of 1972.

“CFR” The abbreviation “CFR” means Code of Federal Regulations.

“EPA” The abbreviation “EPA” means Environmental Protection Agency.

“FTA” The abbreviation “FTA” means Federal Transit Administration.

“LRT” The abbreviation “LRT” means Light Rail Transit.

“OSHA” The abbreviation “OSHA” means Occupational Safety and Health Administration.

“NSC” The abbreviation “NSC” means National Safety Council.

“U.S.C.” The abbreviation “U.S.C.” means United States Code.

1.1 DEFINITIONS

“Agency” The term “Agency” means Valley Metro Rail, Inc., or its successors or assigns, acting by and through its authorized representative.

“Agency’s Project Manager” The term “Agency’s Project Manager” means the Agency’s representative responsible for the day to day management of the Contract.

“Change” The term “Change” means modifications to the Contract.

“Change Order” The term “Change Order” means a written document signed by the Agency and the Contractor which alters the scope of the Work to be performed by the Contractor, changes the schedule for performance of the Work, increases or decreases the Contractor’s compensation, or makes any other change to the Contract.

“Contract” The term “Contract” means the written agreement between the parties inclusive of any Exhibits, Attachments and any Change Orders issued pursuant thereto.

“Contract Amount” The term “Contract Amount” means the total dollar value of the Contract for the performance of Work.

“Contractor” The term “Contractor” means the individual, sole proprietorship, partnership, firm, company, corporation, joint venture, or other legal entity entering into this Contract for the performance of the Work required by this Contract.

“Contractor’s Project Manager” The term “Contractor’s Project Manager” means the Contractor’s authorized representative.



“Days” The term “Days” means calendar days which includes every day of the year.

“Notice to Proceed” The term “Notice to Proceed” means Agency’s written notification to Contractor to commence Work.

“Party” or “Parties” The terms “Party” or “Parties” means Agency and/or Contractor.

“Revenue Service” The term “Revenue Service” means the operation of the Light Rail Transit system.

“Subcontractor” The term “Subcontractor” means any person, firm, partnership, corporation, or other entity, other than employees of the Contractor, who contract with the Contractor to furnish labor, material and/or equipment under this Contract.

“Work” The term “Work” means the furnishing of all of the supervision, labor, material, equipment, services, and incidentals necessary to perform the Contract.

SECTION 2 - CONTRACTUAL REQUIREMENTS

2.0 CONTRACT TYPE AND AMOUNT

This is a Cost Plus Fixed Fee (CPFF) type Contract. The total Contract Amount is $____________ for the performance of Work in accordance with the terms and conditions of the Contract.

2.1 CONTRACT TERM

This Contract shall be effective for a five (5) year period (“Contract Term”) on and after the date it is executed by the last Party to sign the Contract.

2.2 OPTION TO EXTEND

The Agency may, at its option and with the approval of the Contractor, extend the Contract Term up to a maximum of three 3 year term options. The Contractor shall be notified in writing of the Agency’s intention to extend the Contract Term at least twelve (12) months prior to the expiration of the current Contract Term.

2.3 ANNUAL FUNDING

The Parties recognize that the continuation of this Contract after the close of any given fiscal year of the Agency is subject to the approval of the Agency’s budget providing an appropriation covering this Contract as an expenditure item therein. Agency does not represent that the aforementioned budget will actually be adopted, since such a budgetary determination is solely that of the Board of Directors at the time of the adoption of the budget. Agency’s fiscal years end on June 30 of each year.

Should any fiscal year approved budget of the Agency not include an appropriation covering this Contract as an expenditure item therein, the Agency may suspend or terminate this Contract for convenience in accordance with Section 2.12 (Suspension of Work) or Section 2.13 (Termination for Convenience), respectively. Agency shall notify Contractor promptly in writing of the non-appropriation of funding for this Contract.



2.4 TIME OF THE ESSENCE

Time is of the essence in the performance of the Work. Therefore, the Contractor agrees to provide sufficient number of qualified personnel and other resources needed to perform the Work in a prompt and diligent manner. It is expected that the Contractor be prepared to immediately begin Work upon contract execution and Notice to Proceed.

2.5 INTENT OF CONTRACT/ORDER OF PRECEDENCE

The Contract, Exhibits, Attachments and Change Orders to the Contract are essential to this Contract. All are intended to be complementary. A requirement occurring in one is as binding as though occurring in all.

The documents referenced below are in descending order of precedence. Any conflict between any of the documents shall be resolved in favor of the document with higher precedence.

•

•

•

•

Change Orders

Contract

Contract Exhibits

Contract Attachments

The Contractor shall notify Agency immediately of any obvious or discovered ambiguity or conflict within or between documents, any obvious or discovered error, omission, lack of necessary detailed description and request clarification and direction. Agency will provide clarification and direction as required to fulfill the intent of the Contract. Agency will issue a Change Order, in accordance with Section 5.0, if necessary.

Proceeding without the required notification and request for clarification or instruction shall be at the Contractor’s risk and any Work performed may be determined to be non-conforming.

2.6 SEVERABILITY

If a provision of this Contract is found by a court of competent jurisdiction to be unenforceable, the validity and enforceability of the remaining provisions shall remain unaffected. The parties shall negotiate an equitable adjustment of this Contract so that the purposes of this Contract are affected.

2.7 NOTICES AND COMMUNICATIONS

A. All notices and other communications concerning this Contract shall be written in English and shall bear the number assigned to this Contract by Agency. Notices and other communications may be delivered personally, by telegram, by facsimile, or by regular, certified, or registered mail. Notices and communications are effective when received.

B. Prior to issuance of the Notice to Proceed, a notice to or communication with Agency will be effective only if it is delivered to Agency’s Manager Contract and Procurement, 101 N. 1st Avenue, Ste 1300, Phoenix, AZ 85003. Following issuance of Notice to Proceed, all communications and notices shall be delivered



to the Project Manager with a copy to the Manager of Contracts & Procurement at the address designated by Agency. All correspondence shall reference the Contract number.

C. Prior to commencement of Work, a notice to or communication with Contractor will be effective only if it is delivered to the individual who signed this Contract on behalf of Contractor at the address shown with that signature.

D. After the commencement of Work, all formal communications shall be between the Contractor’s Project Manager and the Agency’s Project Manager.

2.8 INSURANCE

A. Agency Provided Insurance

1. Bodily Injury and Property Damage Liability

Agency will procure and maintain for the duration of the Contract bodily injury and property damage insurance in the name of Agency, the Regional Public Transit Authority (RPTA), the Transportation Services Contractor, the Systems & Facilities Maintenance Services Contractor and Vehicle Maintenance Contractor, as well as others to be added at the Agency’s sole discretion, including, but not limited to, Agency Member Cities, the State of Arizona/Arizona Department of Transportation, Union Pacific Railroad (UPRR) and their respective Consultants, representatives, officers, directors and employees. Such insurance shall cover bodily injury and property damage arising out of the operations and maintenance of Agency Light Rail Transit Services. The policy shall be written on an occurrence form similar in scope to CV Starr Special Excess Liability Policy for Transit Agencies form 76273 (6/00). The per occurrence limits of liability shall be at least One Hundred Million Dollars ($100,000,000).

Agency shall have the right to self-insure for any part of the insurance coverage up to Five Million Dollars ($5,000,000) per occurrence.

2. Property Insurance

Agency shall procure and maintain or self-insure for the duration of this Contract, property insurance covering the real and personal property owned, rented or leased by Agency (including, but not limited to, light rail equipment, rolling stock, and buildings) against all risk of physical damage usually covered in a property insurance policy. Such insurance will not include the perils of earthquakes and flood and will be subject to certain limits, sub-limits and deductibles. This insurance will include a waiver of subrogation as respects the Contractor.

B. Contractor Provided Insurance

1. General Provisions

The Contractor is primarily responsible to manage and mitigate risk in the performance of its work under this Contract, including but not limited to obtaining and



maintaining, the required insurance and establishing and maintaining a reasonable risk control and safety program. Agency reserves the right to amend the requirements herein at any time during the Contract subject to at least sixty (60) days written notice. Agency may elect at any time, subject to the notice provision of this Section, to itself provide any or all of the coverage required in this Section, provided that Agency and Contractor agree upon an appropriate adjustment of the compensation terms of the Contract to offset any increase or decrease in the Contractor’s actual costs attributable to Agency’s changes. The Contractor shall require any and all Subcontractors to maintain insurance as appropriate. Contractor warrants that this Section has been thoroughly reviewed by the Contractor’s insurance agent/broker, who has been instructed to procure the required insurance coverage.

Prior to beginning the work under this Contract and without limiting any liabilities or other obligations of Contractor, Contractor shall obtain and maintain, and/or cause to be obtained and maintained, the required forms and minimum amounts of insurance coverage as outlined below. Contractor’s responsibility and liability for the Work provided by its subcontractor is not limited in any fashion by the types and limits of subcontractor’s insurance. Coverage shall be in full force and effective during the terms of this Contract.

Upon execution of the Contract, and prior to commencement of the Work, the Contractor shall provide certificate(s) of insurance, from insurers and in form(s) acceptable to Agency, to evidence that policies providing the required coverage, conditions and limits as set forth in the Section are in full force and effect. Such certificates shall identify this Contract and contain provisions that coverage afforded under the policies shall not be canceled or terminated, until after thirty (30) days prior written notice has been given to Agency.

If an insurance policy expires during the life of the Contract, the Contractor shall provide to Agency a renewal certificate of insurance of the required coverage prior to the expiration date.

The words “endeavor to” shall be deleted from the certificate form’s cancellation provision.

Failure of Agency to demand such certificate(s) or other evidence of full compliance with these insurance requirements or failure of Agency to identify a deficiency from the evidence that is provided shall not be construed as a waiver of Contractor’s obligation to maintain such insurance.

Certificate(s) of insurance and notice of cancellation should be mailed to the following address or such other addresses as designated by Agency from time to time:

Risk Manager Valley Metro Rail, Inc. 101 North 1st Avenue, Suite 1300 Phoenix, AZ 85003



Failure to maintain the required insurance may result in the termination of this Contract at Agency’s option. If Agency does not terminate the Contract, it shall have the right, but not the obligation, to purchase said insurance at Contractor’s expense in which case, Contractor shall promptly reimburse Agency upon demand. If Agency does not terminate the Contract, it shall have the right, but not the obligation, to purchase said insurance at Contractor’s expense on which case, Contractor shall promptly reimburse Agency upon demand.

Each insurance policy shall be written on a primary coverage basis, including any self-insured retentions, unless expressly approved by Agency in writing.

Any failure by the Contractor to comply with the reporting requirements of the required insurance coverage shall not affect the coverage provided to Agency or Agency’s members.

To the extent permitted by law, Contractor waives all rights of subrogation or similar rights against Valley Metro Rail, Inc. and its Members, the State of Arizona/Arizona Department of Transportation and their respective Consultants, representatives, officers, directors and employees.

Approval of insurance by Agency as required above shall not relieve or decrease the liability of the contractor or its sub-contractors under the Liability and Hold Harmless clause included herein.

Insurance policies must be from a carrier having an “AM Best” rating of “A-” or above.

2. Workers’ Compensation and Employers Liability Insurance

Contractor shall maintain Workers’ Compensation and Employers Liability insurance.

Worker’s Compensation coverage shall be in accordance with the Federal and State statutes having jurisdiction over the employees where the work is performed.

The Commercial Umbrella and/or Employers Liability limits shall not be less than $1,000,000 each accident for bodily injury by accident or $1,000,000 each employee for bodily injury by disease.

3. Automobile Liability Insurance At all times during this Contract, the Contractor agrees to maintain Automobile Liability and, if necessary, Commercial Umbrella Liability insurance with a limit of not less than $5,000,000 each accident.

Insurance shall cover liability arising out of the use of any auto (including owned, hired, and non-owned autos (with the exception of Agency owned autos).

Coverage shall be written on ISO form CA 00 01, or a substitute form providing equivalent liability coverage.



With respect to Agency vehicles loaned or leased to Contractor for the completion of the Work, Agency will provide coverage under the Bodily Injury and Property Damage Liability policy.

2.9 INDEMNIFICATION This liability and indemnification Section shall apply to all claims filed in connection with events occurring on or after the Notice to Proceed for the duration of the Agreement.

Allocation of Liability: Except with regard to “Excluded Conduct” as defined below, and except as otherwise provided for in this Section, Agency shall, at its sole expense, indemnify and hold harmless the Contractor, its employees, agents, and/or subcontractors, from all damage and all liability for injuries to or death of any person or persons, and from any and all liability for loss, damage or destruction to any property, which arises out of performance of the services required hereunder. The Contractor is solely responsible for claims, damages, losses and expenses, including, but not limited to, attorney’s fees and court costs, associated with Workers’ Compensation, Employer’s Liability, Employment Practices Liability and Automobile Liability claims or losses and waives all rights of subrogation against Agency for such claims and/or losses. The Contractor agrees at its sole expense to defend, indemnify and hold harmless Agency against any claims for injury or death to any person or persons, and from any and all liability for loss, damage or destruction to any property, which arises from the operation of a Contractor owned vehicle. Excluded Conduct: Except as provided specifically below, the undertakings in this Section to defend, indemnify, and hold harmless the Contractor, its employees, agents, and/or subcontractors, shall apply without regard to the negligence or fault of the Contractor, its employees, agents, and/or subcontractors. Notwithstanding any other provision of this section, Agency shall have no duty to indemnify and hold harmless the Contractor, its employees, agents, and/or subcontractors, for any liability of the Contractor if it is reasonably determined by Agency that such liability arose as a result of Excluded Conduct of the Contractor and the Contractor shall indemnify and hold harmless Agency for any such liability. Excluded Conduct is conduct for which there is clear and convincing evidence that the liability arises out of an act or omission by the Contractor which constitutes, oppression, fraud, malice or recklessness. For the purposes of this subsection, the following definitions shall apply:

a) “Oppression” means despicable conduct that subjects a person to cruel and unjust hardship in conscious disregard of that person’s rights;

b) “Fraud” means an intentional misrepresentation, deceit, or concealment of a material fact

with the intention of thereby depriving a person of property or legal rights or otherwise causing injury;

c) “Malice” means conduct which is intended to cause injury to others or despicable conduct

which is carried on with a willful conscious disregard of the rights or safety of others;

d) “Recklessness” means conduct which is of unreasonable character that was 1) performed in disregard of a known risk or that was 2) performed in disregard to a risk so obvious that he/she must have been aware of the risk.



Agency shall not be responsible for Excluded Conduct pursuant to this Subsection unless Agency’s officer, director, or other person with oversight responsibilities for Contractor’s employees, agents, and/or subcontractors, had advance knowledge of the unfitness of the Contractor’s employee, agent, and/or subcontractor and employed him or her, or continued to employ him or her, with a conscious disregard of the rights or safety of others or authorized or ratified through wrongful conduct for which the exemplary damages were or would have been awarded. The limitation of the scope of indemnities created by this Subsection shall in no way change any duty to defend against claims that are established in this Section.

Except as provided above, if suit shall at any time be brought against either party asserting a liability against which the other party agrees to indemnify and save harmless the party sued, the indemnifying party shall, at its own cost and expense, and without any cost or expense whatever to the party sued, defend such suit and indemnify and save harmless the party sued against all costs and expenses thereof and promptly pay or cause to be paid any final judgment recovered against the party sued; provided, however, that the party sued shall promptly upon the bringing of any such suit against it give timely written notice to the indemnifying party and thereafter provide, in a timely manner, all such information as may from time to time be requested, and that the party sued shall have reasonable approval rights of any settlement. Each party shall furnish to the other all such information relating to claims made for the injuries, deaths, losses, damage or destruction of the type covered by this section as such other party may from time to time request.

2.8 LIQUIDATED DAMAGES ( RESERVED)

2.9 EXUSABLE DELAYS

Force Majeure: Each Party shall be excused from performance of any of its obligations to the other hereunder, where such nonperformance is occasioned by any event beyond the non-performing Party’s control which shall include without limitation, any order, rule or regulation of any federal, state, or local government body, agent, or instrumentality, Acts of God or the public enemy, wars, civil disturbances, fires, floods, hurricanes, earthquakes that disrupt service, epidemics, quarantine restrictions, freight embargoes, work stoppage or accident; provided that the Party excused hereunder shall use all reasonable efforts to minimize its nonperformance and to overcome, remedy or remove such event in the shortest practical time. The Contractor shall use its best efforts to undertake and complete the repair, restoration, or replacement of any property which is necessary for the provision of Work in accordance with established train schedules and shall resume normal operations and performance of its other obligations hereunder as soon as reasonably possible.

Operation by Agency: If the Contractor is excused from performing its obligations under this Contract for any of the Force Majeure reasons listed above, and such an interruption in the services continues for five (5) days, Agency may provide notice to the Contractor of its intent to begin providing the Work, and may provide those services itself with its own or other personnel without liability to the Contractor. The Contractor shall cooperate with Agency and Agency’s contractor to effect a seamless transition in such cases.



2.10 SUSPENSION OF WORK

The Agency may order the Contractor in writing to suspend all or any part of the Work for such reasonable period of time as the Agency determines to be appropriate for the convenience of the Agency.

If the performance of all or any part of the Work is, for more than forty five (45) Days, suspended or delayed by an act of the Agency in the administration of this Contract, or by the Agency's failure to act within the time specified in this Contract (or, if no time is specified, within a reasonable time), an adjustment shall be made for any increase in cost of performance of this Contract (excluding profit) necessarily caused by such unreasonable suspension or delay, and the Contract modified in writing accordingly.

However, no adjustment shall be made under this clause for any suspension or delay to the extent (1) that performance would have suspended or delayed by any other cause, including the fault or negligence of the Contractor, or (2) for which an equitable adjustment is provided for or excluded under any other provision of this Contract.

No claim under this clause shall be allowed (1) for any costs incurred more than twenty (20) days before the Contractor shall have notified the Agency in writing of the act or failure to act involved (but this requirement shall not apply to a claim resulting from a suspension order), and (2) unless the claim, in an amount stated, is asserted in writing as soon as practicable after the termination of such suspension or delay, but not later than the date of final payment. No part of any claim based on the provisions of this clause shall be allowed if not supported by adequate evidence showing that the cost would not have been incurred but for a delay within the provisions of this clause.

Agency’s order to suspend all or any portion of the Work shall be limited to a maximum duration of 30 days per suspension, with an aggregate maximum duration limit of 120 days during the Term of the Contract.

2.11 TERMINATION FOR CONVENIENCE

A. Agency may terminate performance of Work under this Contract in whole, or in part if Agency determines that a termination is in the best interest of the Agency. Agency shall terminate by delivering to the Contractor a notice of termination specifying the extent of termination and the effective date.

B. After receipt of a notice of termination, and except as directed by Agency, the Contractor shall immediately proceed with the following obligations regardless of any delay in determining or adjusting any amounts due under this section:

(1) stop work as specified in the notice;

(2) place no further subcontracts or orders (referred to as subcontracts in this section for equipment, spare parts, materials, services, or supplies), except as necessary to finally complete the continued portion of the Contract;

(3) terminate all subcontracts or orders to the extent they relate to the Work terminated;



(4) assign to Agency, as directed by Agency, all right, title and interest of the Contractor under the subcontract terminated, in which case Agency shall have the right to settle or to pay any termination settlements proposal arising out of those terminations;

(5) with approval or ratification to the extent required by Agency, settle all outstanding liabilities and termination settlement proposals arising from the termination of the subcontract; the approval or ratification will be final for purposes of this section;

(6) as directed by Agency, transfer title and deliver to Agency completed Work, Work in process, equipment, spare parts, materials, supplies, and other material produced or acquired for the Work terminated;

(7) finally complete performance of the Work not terminated;

(8) take any action that may be necessary, or that Agency may direct, for the protection and preservation of property related to this Contract that is in possession of the Contractor and in which Agency has or may acquire an interest;

(9) use its best efforts to sell, as directed or authorized by Agency, any property of the types referred to in subparagraph (6) above; provided, however, that the Contractor (i) is not required to extend credit to any purchaser and (ii) may acquire the property under the conditions prescribed by, and at prices approved by Agency. The proceeds of any transfer or disposition will be applied to reduce any payments to be made by Agency under this Contract, credited to the price or cost of the Work, or paid in any other manner directed by Agency.

C. After termination, the Contractor shall submit a final termination settlement proposal to Agency in the form and with the certification prescribed by Agency. The Contractor shall submit the proposal promptly, but no later than one (1) year from the effective date of termination, unless extended in writing by Agency upon written request of the Contractor within this one (1)-year period. However, if Agency determines that the facts justify it, a termination settlement proposal may be received and acted on after one (1) year or any extension. If the Contractor fails to submit the proposal within the time allowed, Agency may determine, on the basis of information available, the amount, if any, due the Contractor because of the termination and shall pay the amount determined.

D. Subject to paragraph (C) above, the Contractor and Agency may agree upon the whole or any part of the amount to be paid because of the termination. The amount may include a reasonable allowance for profit on Work done. However, the agreed amount, whether under this paragraph (D) or paragraph (E) below, exclusive of costs shown in subparagraph (E)(2) below, may not exceed the total Contract Amount as reduced by (1) the amount of payments previously made and (2) the Contract Amount of Work not terminated. The Contract shall be amended, and the Contractor paid the agreed amount. Paragraph (E) below shall not limit, restrict, or affect the amount that may be agreed upon to be paid under this paragraph.



E. If the Contractor and Agency fail to agree on the whole amount to be paid the Contractor because of the termination of Work, Agency shall pay the Contractor the amounts determined as follows, but without duplication of any amounts agreed upon under paragraph (D) above:

(1) For contract Work performed before the effective date of termination, the total (without duplication of any items) of:

a) The cost of the Work;

b) The cost of settling and paying termination settlement proposals under terminated subcontracts that are properly chargeable to the terminated portion of the Contract if not included in subdivision (a) above; and

c) A sum, as profit on (a) above, determined by Agency to be fair and reasonable; however, if it appears that the Contractor would have sustained a loss on the entire Contract had it been finally completed, Agency shall allow no profit under this subdivision (c) and shall reduce the settlement to reflect the indicated rate of loss.

(2) The reasonable costs of settlement of the Work terminated, including:

a) accounting, legal, clerical, and other expenses reasonably necessary for the preparation of termination settlement proposals and supporting data;

b) the termination and settlement of subcontracts excluding the amounts of such settlements; and

c) storage, transportation, and other costs incurred, reasonably necessary for the preservation, protection, or disposition of the termination inventory.

F. Except for normal spoilage, and except to the extent that Agency expressly assumed the risk of loss, Agency shall exclude from the amounts payable to the Contractor under paragraph E. above, the fair value, as determined by Agency of property that is destroyed, lost, stolen, or damaged so as to become undeliverable to Agency or to a buyer.

G. The Contractor shall have the right of appeal, under Section 2.17 (Claims), from any determination made by Agency under paragraph (C), (E), or (I), except that if the Contractor failed to submit the termination settlement proposal within the time provided in paragraph (C) or (I), and failed to request a time extension, there is no right of appeal. If Agency has made a determination of the amount due under paragraph (C), (E), or (I), Agency shall pay the Contractor (1) the amount determined by Agency if there is no right of appeal or if no timely appeal has been taken, or (2) the amount finally determined on an appeal.

H. In arriving at the amount due the Contractor under this section, there shall be deducted:



(1) all unliquidated advance or other payments to the Contractor under the terminated portion of this Contract;

(2) any claim which Agency has against the Contractor under this Contract; and

(3) the agreed price for, or the proceeds of sale of, equipment, spare parts, materials, supplies, or other things acquired by the Contractor or sold under the provisions of this section and not recovered by or credited to Agency.

I. If the termination is partial, the Contractor may file a proposal with Agency for an equitable adjustment of the cost(s) of the continued portion of the Contract. Agency shall make any equitable adjustment as agreed upon. Any proposal by the Contractor for an equitable adjustment under this clause shall be submitted within ninety (90) Days from the effective date of termination unless extended in writing by Agency.

(1) Agency may, under the terms and conditions it prescribes, make partial payments and payments against costs incurred by the Contractor for the terminated portion of the Contract, if Agency believes the total of these payments will not exceed the amount to which the Contractor will be entitled.

(2) If the total payments exceed the amount finally determined to be due, the Contractor shall repay the excess to Agency upon demand.

J. Unless otherwise provided in this Contract or by statute, the Contractor shall maintain all records and documents relating to the terminated portion of this Contract for three (3) years after final settlement. This includes all books and other evidence bearing on the Contractor's costs and expenses under this Contract. The Contractor shall make these records and documents available to Agency, at the Contractor's office, at all reasonable times, without any direct charge. If approved by Agency, photographs, microphotographs, or other authentic reproductions may be maintained instead of original records and documents.

2.12 TERMINATION FOR DEFAULT

A. Agency may, by written notice of default to the Contractor, terminate this Contract in whole or in part if the Contractor fails to (i) make progress, so as to endanger performance of this Contract; (ii) perform any of the other provisions of this Contract; or (iii) perform the Work required by the Contract.

B. Agency's right to terminate this Contract under subparagraphs (A) (i), (ii) and (iii) of this section, may be exercised if the Contractor does not take action to cure such failure within twenty (20) Days after receipt of the notice from the Project Manager specifying the failure and/or if the Contractor does not cure such failure within thirty (30) Days. The Agency, in its sole discretion, may allow an extension of such cure periods. To obtain Agency’s approval to extend such



cure periods, the Contractor must submit a written statement specifying its reasons for such an extension.

C. If Agency terminates this Contract in whole or in part, it may acquire, under the terms and in the manner the Agency considers appropriate, Work similar to those terminated, and the Contractor will be liable to Agency for any excess costs for such Work. The Contractor shall continue the Work not terminated.

D. Contractor shall be paid only for completed Work performed and accepted. The Agency may allow Contractor to continue Work, only if the reason for not performing is caused by a strike, fire, flood, or Act of God. Work terminated due to a strike, fire, flood, or Act of God shall be treated by the Agency as a termination for convenience.

2.13 STATUTORY RIGHT OF CANCELLATION FOR CONFLICT OF INTEREST

Notice is given that pursuant to A.R.S. § 38-511 Agency may cancel this Contract without penalty or further obligation if any person significantly involved in initiating, negotiating, securing, drafting or creating the contract on behalf of Agency is at any time while the Contract or any extension of the Contract is in effect, an employee or agent of any other Party to the Contract in any capacity or consultant to any other Party of the Contract with respect to the subject matter of the Contract. Additionally, pursuant to A.R.S. § 38-511 Agency may recoup any fee or commission paid or due to any person significantly involved in initiating, negotiating, securing, drafting or creating the contract on behalf of Agency from any other party to the contract arising as the result of the contract.

2.14 CANCELLATION RIGHTS

This Contract is subject to cancellation by Agency pursuant to the provisions of Section 38-511, Arizona Revised Statutes.

2.15 CLAIMS

A. The parties will endeavor to resolve any claims pursuant to the agreed partnering process. For any recovery or relief under or in connection with the Contract, the Contractor shall submit a written claim to the Agency’s Project Manager. The written claim shall set forth:

(1) the reasons for which the Contractor believes additional compensation will or may be due;

(2) the claimed costs and time involved. The claimed costs must be certified by the Contractor’s Project Manager as being current, complete and accurate;

(3) Contractor’s plan for mitigating such costs; and

(4) if ascertainable, the amount of the potential claim.

The written claim shall be given to the Agency’s Project Manager promptly after the happening of the event or occurrence giving rise to the potential claim. If the event



or occurrence is claimed to be an act or omission of the Agency, written notice shall be given prior to commencing the portion of the Work to which such alleged act or omission relates. The notice requirements of this section are in addition to any other notice requirements set forth in the Contract. In addition:

(1) the Contractor’s written claim shall include in sufficient detail the information necessary for the Agency’s Project Manager to ascertain the basis and amount of the claim;

(2) the written claim shall be certified as being made in good faith and signed by the Contractor’s Project Manager;

(3) in the spirit of the partnering process, the Agency’s Project Manager and the Contractor’s Project Manager agree to work together and discuss the claim so as to avoid unnecessary losses, delays, and disruptions in the Work;

(4) the Agency’s Project Manager will render a decision on the claim no later than ten (10) Days after receiving the Contractor’s written claim.

B. Claims not resolved by the Agency’s Project Manager and the Contractor’s Project Manager will be forwarded to the Agency’s Director of Operations & Maintenance for further review and consideration.

(1) The Agency’s Director of Operations & Maintenance may request that the Contractor supplement its claim and provide additional information as the Agency’s Director of Operations & Maintenance deems necessary.

(2) The Agency’s Director of Operations & Maintenance will issue a recommended decision promptly after receiving the Contractor’s written claim and any additional information.

C. Claims not resolved by the Agency’s Director of Operations & Maintenance will be submitted to the Agency’s Chief Executive Officer (CEO).

(1) The CEO will consider all the information submitted by the Contractor and the opinions and decisions of the Agency’s Project Manager and Director of Operations & Maintenance.

(2) The CEO may conduct further discussions and meetings with the Contractor. The CEO may request additional information from the Contractor relating to the claim.

(3) The CEO will issue a final decision no later than ninety (90) Days after receiving the Contractor’s written claim from the Agency’s Director of Operations & Maintenance, or in such longer period of time as the CEO deems necessary.

D. Claims not resolved by the CEO will be processed further in accordance with Section 2.16 (Disputes).



E. The Contractor agrees that it shall give the Agency and its representatives access to its books, records and other materials relating to the Work, and shall cause its subcontractors to do the same, so the Agency can fully consider the claim.

F. In no event shall claims be made after final payment under the Contract.

2.16 DISPUTES

A. Any dispute concerning a question of fact arising under the Contract which is not disposed of by agreement as outlined in Section 2.15 above, the Contractor’s sole and exclusive remedy is to initiate court proceedings in Maricopa County, Arizona to resolve the claim. The Contractor shall not initiate court proceedings until the date on which the Chief Executive Officer (CEO) has rendered its Final Decision in accordance with Section 2.15 (Claims). The Contractor and Agency agree that the proper venue for court proceedings is Maricopa County Superior Court in Maricopa County, Arizona. Any claim arising out of, under, or in connection with the Contract shall be governed by Arizona law.

B. If the Contractor fails to initiate court proceedings within ninety (90) days following the CEO’s Final Decision, such decision shall become final and binding on the Contractor and the Contractor will be deemed to have waived any right to initiate court proceedings.

C. Unless provided to the contrary in the Contract, the Contractor shall continue to perform the Work and the Agency shall continue to satisfy its payment obligations to the Contractor, pending the final resolution of any claim in court or otherwise.

D. The Contractor and Agency agree that the prevailing party is entitled to recover its attorney fees and costs (including taxable costs) incurred in the court proceedings.

2.17 APPLICABLE LAW AND JURISDICTION

Arizona law shall govern this Contract. Any suit or action arising from this Contract shall be commenced and prosecuted in the Superior Court of Maricopa County, Arizona.

2.18 ATTORNEYS’ FEES

In the event suit is brought and an attorney is retained by any Party to this Contract to enforce the terms of this Contract, to collect any monies due hereunder, or to collect money damages for breach hereof, the prevailing Party shall be entitled to recover, in addition to any other remedy, reimbursement for reasonable attorneys fees, court costs, costs of investigation and other related expenses incurred in connection therewith.

2.19 AGENCY’S RIGHT TO INFORMATION

Agency shall have the right to obtain from the Contractor within ten (10) days of a request any information related to the Work or the work property; provided, however, that if the Contractor



requires additional time beyond ten (10) days, it shall notify Agency and shall provide the information within the stated additional time approved by the Agency.

2.20 OTHER CONTRACTING RIGHTS

Agency reserves the right to remove any portion of the Work from the Contractor in accordance with Section 2.14 (Termination for Default). Agency may, at its sole discretion, augment or supplant the Work that is not within the scope to this Contract with its own forces or forces of another contractor or agency upon written notice to the Contractor. The Contractor shall cooperate fully with Agency’s staff or contractors that may be providing similar or same Work. Any employee or contractor of such person, corporation or other entity shall be permitted to perform the contracted functions at any location on the Work property; provided, however, that no such employee or contractor shall unreasonably interfere with the Contractor’s provision of the Work.

2.21 USE OF AGENCY LOGO

The Contractor shall obtain written authorization from Agency prior to using the Agency’s logo or name on any durable good or garment, in any promotional literature, or for any other purpose.

2.22 USE OF AGENCY’S NAME BY THE CONTRACTOR

Agency shall review all Agency related copy proposed for use by the Contractor for advertising or public relations purposes prior to publication. The Contractor shall not allow Agency related copy to be published in its advertisements and public relations programs prior to receiving Agency’s written approval. The Contractor shall ensure that all published information is factual and that it does not, in any way, imply that Agency endorses the Contractor’s firm, service and/or product(s). In addition, Contractor shall not display any signs, posters, or any other advertising matter in or on the Work or on or around the work site other than those prescribed by the Contract or by law without the prior written authorization of Agency.

2.23 OWNERSHIP

Agency, pursuant to this Contract, will own, including but not limited to, any tangible or intangible property and asset, and consumables to which Agency’s funds have been applied. To the extent that any ownership of tangible or intangible asset and consumables arises as a product of this Contract and which may originally vest in the Contractor or subcontractor, the Contractor hereby transfers to Agency all ownership and rights.

2.24 ORGANIZATION - EMPLOYMENT DISCLAIMER

The Contract is not intended to constitute, create, give rise to or otherwise recognize a joint venture agreement or relationship, partnership or formal business organization of any kind, and the rights and obligations of the parties shall be only those expressly set forth in the Contract.

The parties agree that no persons supplied by the Contractor(s) in the performance of obligations under the Contract are considered to be Agency employees, and that no rights of Agency service, retirement or personnel rules accrue to such persons. The Contractor(s)



shall have total responsibility for all salaries, wages, bonuses, retirement withholdings, workmen's compensation, other employee benefits and all taxes and premiums appurtenant thereto concerning such persons, and shall save and hold the Agency harmless with respect thereto.

2.25 OFFSET FOR DAMAGES

In addition to all other remedies at Law or Equity, Agency may offset from any money due to the Contractor any amounts Contractor owes to Agency for damages resulting from breach or deficiencies in performance under Contract.

2.26 CONTINUING OBLIGATIONS

Agency and Contractor acknowledge that all of the assets and facilities of the transit system have previously been leased or purchased by Agency. It is further acknowledged that all agreements, contracts (except labor contracts), indebtedness and other similar obligations of the transit system existing prior to the effective date of this Contract, or existing at any time thereafter, have been and shall remain the sole responsibility of Agency, except to the extent that Contractor assumes administrative responsibility with respect thereto under this Contract. In performing under this Contract, it is understood that all contracts entered into by Contractor during and for this Contract shall be for the benefit of the transit system and approved by Agency. It is further understood and agreed that upon the expiration or other termination of this Contract, all agreements, contractual obligations and the like which have been administered by Contractor on behalf of Agency and for the benefit of Agency shall automatically revert to Agency under the same terms and conditions as are contained in the existing contract.

2.27 COMPLIANCE WITH ENVIRONMENTAL LAWS

A. Definitions

1. Environmental Laws shall mean those laws promulgated for the protection of human health or the environment, including but not limited to the following as the same are amended from time to time: the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. Section 9601 et seq.; the resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq.; the Toxic Substances Control Act, 15 U.S.C. 2601 et seq.; the Safe Drinking Water Act, 42 U.S.C. Section 300f et seq.; the Clean Water Act, 33 U.S.C. Section 1251 et seq.; the Clean Air Act, 42 U.S.C. Section 7401 et seq.; the Arizona Environmental Quality Act, A.R.S. Section 49-201 et seq.; the Arizona Hazardous Waste Management Act. A.R.S. Section 49-921 et seq.; the Arizona Underground Storage Tank Regulation statute, A.R.S. Section 49-1001 et seq.; Arizona Solid Waste Act, Law 1991, Ch. 315, effective July 3, 1991; the Occupational Safety and Health Act of 1970, as amended, 84 Stat. 1590, 29 U.S.C. Sections 651-678, and the regulations promulgated thereunder and any other laws, regulations and ordinances (whether enacted by the local, state or federal government) now in effect or hereinafter enacted that deal with the regulation or protection of human health and the environment, including the ambient air, ground water, surface water, and land use, including substrata soils.

2. As used herein, the term regulated substances includes:



a. Those substances identified or listed as a hazardous substance, pollutant, hazardous material, or petroleum in the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601 et seq.; the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801 et seq.; and in the regulations promulgated thereto; and Underground Storage Tanks, U.S.C. Sections 6991 to 6991i.

b. Those substances identified or listed as a hazardous substance, pollutant, toxic pollutant, petroleum, or as a hazardous special or solid waste in the Arizona Environmental Quality Act, A.R.S. Section 49-201 et seq.; including, but not limited to, the Water Quality Assurance Revolving Fund Act, A.R.S. Section 49-281 et seq.; the Solid Waste Management Act, A.R.S. Section 49-701 et seq.; the Underground Storage Tank Regulation Act, A.R.S. Section 49-1001 et seq.; and A.R.S. Section 49-851 to 49-868.

c. All substances, materials and wastes that are, or that become, regulated under, or that are classified as hazardous or toxic under any Environmental Law during the term of this Contract.

3. The term release shall mean any releasing, spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, disposing, or dumping.

B. Compliance

1. Contractor shall not cause or permit any regulated substance to be used, generated, manufactured, produced, stored, brought upon, or released on, or under the premises, or transported to or from the premises, by Contractor, its agents, employees, contractors, invitees or a third party in a manner that would constitute or result in a violation of any Environmental Law or that would give rise to liability under an Environmental Law.

Contractor may provide for the treatment of certain discharges regulated under the Federal Clean Water Act, 33 U.S.C. Section 1251 et seq.

2.28 COMPLIANCE WITH LAWS AND REGULATIONS

Contractor shall adhere to all applicable federal, state, and local laws, regulations, executive orders, and ordinances applicable to the Work under this Contract.

If any discrepancy or inconsistency is discovered in the Contract in relation to any such requirements of law, the Contractor shall immediately report the facts to the Agency, in writing.

Should changes to any such applicable federal, state, and local laws, regulations, executive orders, and ordinances occur after the date of execution of this Contract which in the Contractor’s opinion require a change in the Contract Amount or time required for the performance of the Work hereunder, the Contractor shall provide written notification to Agency in accordance with Section 5.0 (Changes in the Work).



2.29 PROHIBITED INTERESTS

No Agency board member, officer, employee, or agent shall have any direct or indirect pecuniary interest in this Contract or its proceeds during, or within one year after, that person's tenure with Agency.

Except for unsolicited gifts of nominal value given for advertising purposes, no Agency board member, officer, employee, or agent shall solicit or accept gifts, gratuities, favors, or anything of monetary value in connection with this Contract. Contractor shall not offer or give to any Agency board member, officer, employee, or agent, any gifts, gratuities, favors, or anything of monetary value in connection with this Contract.

No member of, or delegate to, the Congress of the United States shall be admitted to a share or part of this Contract or to any benefit arising therefrom.

2.30 PARAGRAPH HEADINGS AND OTHER TITLES

The parties agree that paragraph headings and other titles used in this Contract are for convenience only, and are not to be used to interpret this Contract.

2.31 AUDIT AND INSPECTION OF RECORDS

The Contractor agrees to provide Agency, the FTA Administrator, the Comptroller General of the United States, or any of their authorized representative access to any books, documents, papers, and records of the Contractor which are pertinent to this Contract for the purpose of making audits, examinations, excerpts and transcriptions. Contractor also agrees, pursuant to 49 CFR 633.17 to provide the FTA Administrator or his authorized representative access to Contractor’s records and Work site(s).

The Contractor agrees to permit any of the foregoing parties to reproduce by any means whatsoever or to copy excerpts and transcriptions as reasonably needed.

The Contractor agrees to maintain all books, records, accounts and reports required under this Contract for a period of not less than three (3) years after the date of termination or expiration of this Contract, except in the event of litigation or settlement of claims arising from the performance of this Contract, in which case Contractor agrees to maintain same until Agency, the FTA Administrator, the Comptroller General, or any of their duly authorized representatives, have disposed of such litigation, appeals, claims, or exceptions related thereto.

Contractor further agrees to include in all of its Subcontracts under this Contract a provision to the effect that the Subcontractor agrees that Agency, the FTA Administrator, and the Comptroller General of the United States, or any of their duly authorized representatives shall, until the expiration of three (3) years after final payment under the subcontract, have access to and the right to examine any directly pertinent books, documents, papers, and other records of the Subcontractor. The term "subcontract" as used in this Section excludes (1) purchase orders not exceeding $10,000.00 and (2) subcontracts or purchase orders for public utility services at rates established for uniform applicability to the general public.



2.32 TAXES

Unless otherwise provided in the Contract, Contractor shall pay all sales, use, and other similar taxes that are currently in effect on the date the Contract was executed by the Contractor.

2.33 INTEGRATION AND MODIFICATION

This Contract includes the entire agreement of the Parties and supersedes any prior discussions or agreements regarding the same subject. This Contract may be modified only in writing by a Change Order that has been signed by individuals authorized to bind each of the Parties contractually.

2.34 WAIVER AND NONWAIVER

The failure of Agency at any time to require performance of any provision of this Contract shall in no way affect the right of Agency to enforce such provision thereafter or to enforce any other provision of this Contract.

A waiver by one Party of a right to a remedy for breach of this Contract by the other Party shall not be deemed to waive the right to a remedy for a subsequent breach by the other Party. Agency's acceptance of the Work, and payment under this Contract, shall not preclude Agency from recovering against Contractor for damages due to Contractor's failure to comply with this Contract.

The parties acknowledge that the language of this Contract is the result of negotiations and compromises, and that no presumption shall arise as to the interpretation of this Contract by reason of which Party or attorney served as principal draftsperson.

2.35 INTELLECTUAL PROPERTY

Contractor shall hold harmless, defend and indemnify Valley Metro Rail, Inc., it’s members and its representatives, agents, officers, employees and directors, the State of Arizona and Arizona Department of Transportation from any loss of any kind, based on a claim that the Work performed, or products provided hereunder, including material(s) or any part thereof, constitutes infringement of any patent, trademark, tradename, copyright, trade secret, or other intellectual property infringement, including but not limited to claims arising out of the manufacture, sale or use of such Work, products or materials. Such indemnification shall include all damages and costs incurred by Agency as the result of the claim, including legal fees.

2.36 AGENCY’S RIGHT TO ASSIGN AND NOVATION

The parties agree that should another publicly funded transportation agency wish to provide the Work provided hereunder, that Agency may, after consultation with Contractor, assign all of Agency’s rights and obligations under this Contract to such publicly funded transportation agency. In the event of such assignment, it is expressly agreed that Agency's FTA Section 13(c) obligations shall be assignable by Agency to any successor publicly funded transportation agency and upon such assignment Agency shall be released and discharged from further Section 13(c) obligations. It is further agreed that should such an assignment take place, all of the obligations and



responsibilities of Agency shall be assumed by any successor publicly funded transportation agency and it is the responsibility of Agency to ensure that such successor publicly funded transportation agency assumes such obligations and responsibilities as a condition of the assignment.

2.37 AGENCY STANDARDS OF CONDUCT

Agency maintains a written code of standards of conduct governing the performance of their employees engaged in the award and administration of contracts. No employee, officer, agent, immediate family member, or Board member of Agency will participate in the selection, award, or administration of a contract supported by FTA funds if a conflict of interest, real or apparent, would be involved.

Such a conflict would arise when any of the following has a financial or other interest in the Contract:

(1) The employee, officer, agent, or Board member, (2) Any member of his/her immediate family, (3) His/her partner, or (4) An organization that employs, or is about to employ, any of the above. Agency’s officers, employees, agents, or Board members will neither solicit nor accept gifts, gratuities, favors, or anything of monetary value from Contractors, potential contractors, or parties to sub agreements. To the extent permitted by state or local law or regulations, such standards of conduct provide for penalties, sanctions, or other disciplinary action for violation of such standards by Agency’s officers, employees, or agents, or by Contractors or their agents.

SECTION 3 - SCOPE OF WORK

3.0 RESPONSIBILITY OF THE CONTRACTOR

A. The Contractor shall be responsible for the quality, accuracy and coordination of all Work furnished by the Contractor under this Contract. The Contractor shall, without additional compensation, correct, revise or otherwise address any errors or deficiencies in its Work.

B. In the event that the principal entity of any Joint Venture or teaming agreement is other than the firm performing the Work or a component of the Work, such principal entity agrees to the Agency’s right to contact other team members as the Agency deems reasonable and necessary in the performance of the Work of this Contract. The Agency shall contact with individual parties, by first notifying the prime entity of the intent and purpose of the contact. The prime entity shall, at its discretion determine whether its presence is necessary at such meetings. The actions and conclusions reached at these meetings shall be acknowledged and concurred with in writing, in accordance with the applicable requirements of this Contract, by the Agency and the Contractor. Such direct contact between the Agency and team member(s) other than the prime entity shall not constitute or waive any of the obligations and duties of the Joint Venture or teaming members responsible for the full and complete performance of the Contract.

C. Agency intends to issue separate contracts with third parties for Systems & Facilities Maintenance Services and LRT Operations Services. Contractor shall coordinate



with such third parties to facilitate successful operations of the Light Rail Transit System.

3.1 CONTRACTOR'S STATUS AND GENERAL RESPONSIBILITIES

A. Contractor is an independent contractor and is entitled to no compensation from Agency other than that provided by this Contract. Contractor shall inform Agency of Contractor's Federal Internal Revenue Service Employer Identification Number, or, if Contractor is an individual with no employer identification number, Contractor's Social Security Number. The Contractor must not be an officer, employee or agent of Agency. The Contractor’s officers, employees, or agents, must not be agents of Agency. The Contractor, its employees or officers shall not hold themselves out either expressly or impliedly as officers, employees or agents of Agency for any purpose whatsoever, nor are they authorized to do so.

B. Contractor shall provide and pay for all supervision, labor, material, equipment, services, and incidentals for full Contract performance, unless this Contract specifically provides otherwise. Contractor shall supervise and direct Contract performance using its best skill, and shall be responsible for selecting the means of Contract performance. If, during or after the term of this Contract, Contractor learns of any actual or potential defect in the Work provided under this Contract, of any problem associated with the results of Contract performance, or of any nonconformance with a provision of this Contract or of federal, state, or local law, Contractor shall inform Agency immediately in writing with a full description of the defect, problem, or nonconformance

3.2 AGENCY’S PROJECT MANAGER

A. Agency shall appoint a Project Manager for this Contract.

B. The Project Manager and his or her representatives shall at all times have access to the Work wherever it is in preparation or progress.

C. The Project Manager shall be the formal contact between Agency and Contractor and shall handle, on behalf of Agency, all matters except those otherwise provided for in the Contract.

D. The Project Manager’s authority shall include authority to approve or reject Work performed, to stop any Work when deemed necessary, to order changes, to receive all notices under the Contract, to establish Contract pay amounts, and to take other appropriate action as necessary in accordance with the Contract.

E. Contractor shall carry out the instructions of the Project Manager concerning the Work to be done under the Contract.

3.3 PROJECT KEY PERSONNEL

A. Project Manager

The Contractor shall appoint an individual acceptable to the Agency to serve as the full time Project Manager through System Start Up, Revenue Service and



Contract Closeout. The individual shall be responsible for the day to day activities for management and supervision of the Contract shall serve as the primary contact to the Agency. The Project Manager shall have a minimum of ten (10) years experience managing similar type of size of projects in a light rail or commuter transit environment.

B. The Contractor shall utilize key personnel acceptable by the Agency to perform its Work.

(1) The Contractor shall remove or reassign any key personnel as reasonably requested by Agency, even if such personnel had been previously approved.

(2) Any substitutions of Contractor key personnel due to reassignment or removal shall be approved by the Agency, such approval not to be unreasonably withheld, a minimum of 30 Days prior to the changes being implemented.

3.4 PERSONNEL

The Contractor shall provide all professional, supervisory, administrative, skilled and unskilled personnel necessary or appropriate to provide the Work and carry out its obligations under this Contract. Contractor shall employ only such persons as are competent and qualified to provide Work in accordance with the requirements of this Contract and the Agency’s policies, practices, procedures and standards. All employees shall meet all applicable qualifications established by federal, state, and local laws and regulations.

The Contractor shall screen all employees and require satisfactory personal references in order to determine character of prospective employees before hiring. The Contractor shall comply with all FTA requirements and Agency guidelines in the area of safety sensitive employees.

All employees of Contractor shall be neatly attired as professionals at all times in a manner that will reflect credit both upon Contractor and the facility in which they are working.

All persons employed by the Contractor shall be U.S. citizens or possess papers showing that they are legal aliens. All persons employed by the Contractor shall speak and understand the English language necessary to perform their duties.

The Contractor shall require employees to comply with the instructions pertaining to conduct and other regulations called to the attention of the Contractor by the Project Manager or designee.

At the Agency’s request, the Contractor shall remove any employee who’s performance has been determined by the Agency to be unsatisfactory. It shall be the Contractor's responsibility to find a suitable replacement for the removed employee.

A list of the Contractor's Safety Sensitive Employees and Applicants shall be submitted to the Project Manager. The list shall include the employee's full name and social security number. Agency reserves the right to review, reject and remove any employee or applicant, with regards to DWI/DUI and other Criminal Offenses for safety sensitive positions, to be utilized



in the performance of this Contract. It shall be the responsibility of the Contractor to keep this list current with Agency.

3.5 NOTICE TO AGENCY OF LABOR DISPUTES

Whenever the Contractor has knowledge that any actual or potential labor dispute is delaying or threatens to delay the timely performance of this Contract, the Contractor shall immediately give notice thereof, including all relevant information with respect thereto, to Agency.

The Contractor agrees to insert the substance of this section in any subcontract hereunder as to which a labor dispute may delay the timely performance of this Contract; except that each such subcontract shall provide that in the event its timely performance is delayed or threatened by delay by any actual or potential labor dispute, the subcontractor shall immediately notify his next higher tier subcontractor, or the prime contractor, as the case may be, of all relevant information with respect to such dispute.

3.6 AGENCY FURNISHED PROPERTY

Agency shall provide to Contractor property as described in Exhibit A – Scope of Work for use only in connection with this Contract. Title to Agency furnished property shall remain with Agency. The Contractor shall use the Agency furnished property only in connection with this Contract.

The Contractor shall maintain adequate property control records of Agency furnished property in accordance with sound industrial practice and shall make such records available for Agency's inspection at all reasonable times. Agency will have access at all times to the premises in which any Agency property is located for the purposes of inspecting Agency property.

The Contractor shall inspect the Agency furnished property prior to acceptance. Upon acceptance of Agency furnished property, the Contractor assumes the risk and responsibility for its loss or damage, except:

1. For reasonable wear and tear; 2. To the extent the property is consumed in performing this Contract; or 3. As otherwise provided for by the provisions of this Contract.

The Contractor shall make no changes to the Agency’s property or equipment to be used in providing the Work without Agency’s prior written approval.

Agency may mark and identify all vehicles and other equipment provided for the Contractor’s use in providing the Work with the Agency logo or other identification marks. Contractor’ use of such vehicles shall be directly and only for the performance of Work hereunder.

The property provided by Agency shall include office space and storage space. Agency shall pay for all utilities in all facilities, office and storage space provided pursuant to this Contract. If Agency cannot provide office and/or storage space to the Contractor, the Contractor may lease other office or storage space subject to Agency’s approval. Any lease or utility payments for such office or storage space shall be an Other Direct Cost which Agency will reimburse the Contractor at cost and without any mark-up under the terms of this Contract.



The Contract performance period is based upon the expectation that Agency furnished property, suitable for use, will be available to the Contractor in sufficient time to enable the Contractor to meet contractual requirements.

Upon completing this Contract, the Contractor shall follow the instructions of Agency regarding the disposition of all Agency furnished property not consumed in the performance of this Contract.

3.7 CHANGES IN EQUIPMENT PROVIDED

Agency has the right to make specific improvements or additions to, or to change entirely the assigned equipment, and the Contractor shall make every reasonable effort to implement operations using such different equipment as soon as possible; provided, however, that no such change shall have any adverse effect on the Contractor’s ability to Work on-time and in accordance with the Contractor’s obligations under this contract.

3.8 CONTINUITY OF WORK

The Contractor recognizes that the Work under this Contract is vital to Agency and must be continued without interruption and that upon Contract expiration, a successor, either Agency or another Contractor, may continue them. The Contractor agrees to exercise its best efforts and cooperation to effect an orderly and efficient transition to a successor.

3.9 THIRD PARTY ACCESS TO EQUIPMENT AND PROPERTY

a. General: Agency shall have the right to permit third party contractors to enter upon the Work Property subject to compliance with all applicable operating and safety rules. Before any such third party is allowed access to the tracks or property adjacent to the tracks that are outside of any yard limits on the Work Property, Agency will require that third party to execute a permit to enter upon the property and secure railroad protective liability insurance, naming Agency, any other railroad, and any contractor which operates or performs services on that portion of the Work Property, as named insureds under the policy, as well as such other insurance as determined by Agency. The third party shall provide original counterparts of all policies to the insureds. Any such insurance shall remain in effect for one year following completion of the work requiring access to the Work Property.

b. Notification: When Agency allows a third party to have access to a portion of the Work Property, Agency shall notify the Contractor promptly of the scope, purpose and duration of that third party’s access.

c. Encroachments: All utility crossings, construction, or encroachments upon the Work Property by or for Third Parties must be approved by Agency and shall then be coordinated with the Contractor as required. Approval by Agency engineering personnel of all construction standards, forms, plan, utility crossings, and encroachments shall be a prior condition to any authorization by Agency for work by a third party to proceed. Forms and standards may receive a one-time approval until revised. Agency reserves the exclusive right to charge a rental or occupancy fee for any such access.



3.10 PROCUREMENT OF EQUIPMENT, SPARE PARTS, MATERIALS AND SUPPLIES

Agency may provide Contractor an initial stock of equipment, spare parts, materials and supplies for the performance of Work hereunder. If not, the Contractor shall procure equipment, spare parts, materials and supplies as needed for the continued performance of Work hereunder. Agency shall reimburse Contractor for actual reasonable costs incurred, without mark-up, for such additional equipment, spare parts, materials and supplies. Such costs shall be considered as Other Direct Costs hereunder. Title of such additional equipment, spare parts, materials and supplies shall convert to Agency upon Agency’s payment to Contractor for such items. Equipment, spare parts, materials and supplies provided by Agency, and those additionally purchased by Contractor, shall be used solely for the purpose of performing the Work required hereunder.

Contractor shall provide, at Contractor’s expense, hand tools and tool boxes required by Contractor’s personnel for the performance of Work hereunder.

3.11 REPORT OF ACCIDENTS

The Contractor shall immediately report to the Operations Control Center (OCC) and then to the Agency’s Project Manager any accident or incident while in the performance of this Contract, involving personnel or damage to material and equipment. The Contractor shall also report this to the Project Manager in writing the same day or within two business days if the accident or incidents occurs on a non-business day. Copies of accident investigation reports of accidents as required, shall be provided to the Project Manager. The Contractor shall keep Agency advised on the status of claims or legal actions filed against the Contractor involving this Contract, whether or not Agency is named in the action.

3.12 EMERGENCIES

Contractor shall develop, implement, and maintain a program to respond to emergencies and services disruptions that may occur. Contractor’s written procedures and process must be submitted to the Agency for review and approval within thirty (30) Days after the start of Work. Occurrences include, but are not limited to:

(a) Disturbances; (b) Illness; (c) Vehicle failures; (d) Inclement weather; (e) Accidents; (f) Employee Injuries; (g) StrikeslWalkoutsIWork Stoppage.

3.13 INSPECTION OF WORK

The Contractor shall provide and maintain a preventative maintenance (PM) program acceptable to Agency for vehicles, equipment, buildings and property in conjunction with the Work to be performed hereunder. The Contractor shall maintain complete inspection records and make them available to Agency. All Work shall be conducted under the general direction of the Agency’s Project Manager and is subject to Agency inspection and test to the extent practicable at all places and at all reasonable times during the term of the Contract.



Agency inspections and tests are for the sole benefit of Agency and do not:

1. Relieve the Contractor of responsibility for providing adequate quality control measures;

2. Relieve the Contractor of responsibility for damage to or loss of the material/service before acceptance;

3. Constitute or imply acceptance; or 4. Affect the continuing rights of Agency after acceptance of the complete Work.

If any Work performed hereunder or equipment provided hereunder are not in conformity with the requirements of this Contract, Agency shall have the right to require the Contractor to immediately take all necessary steps to ensure future performance of the Work in conformity with the requirements of the Contract; and reduce the Contract price to reflect the reduced value of the actual Work performed.

In the event the Contractor fails promptly to take necessary steps to ensure future performance of the Work in conformity with the requirements of the Contract, Agency shall have the right to terminate this Contract for default as provided in the Contract section entitled "Termination for Default".

3.14 WARRANTIES

Contractor warrants that the Work shall be performed in conformity with the descriptions and other data set forth in this Contract, with sound professional and maintenance principles and practices in accordance with accepted industry standards, in accordance with Agency approved/adopted policies and procedures, and that Work performed by Contractor's personnel shall reflect sound professional knowledge, skill and judgment. If any breach of the warranties is discovered by the Agency during the process of the Work ,Contractor shall again cause the nonconforming or inadequate Work to be properly performed at Contractor's sole expense and shall reimburse for costs directly incurred by the Agency as a result of reliance by the Agency on Work failing to comply with the warranties.

SECTION 4 - CONTROL OF WORK

4.0 OPERATIONS AND MANAGEMENT

In addition to the rights and obligations stated elsewhere in this Contract, Agency shall have the following rights with respect to oversight and monitoring of the Contractor’s performance:

a. Monitor the records, facilities, and equipment developed or used, and monitor the personnel used, by the Contractor in performance of its obligations under this Contract, as well as adherence to policies and procedures. Specify supplies and equipment to be used by the Contractor in providing the Work, and provide the Contractor with any required Material Safety Data Sheets (“MSDS”). If the Contractor’s specifications or policies for such items differ from those of Agency, Agency’s policy and specifications shall govern.

b. Inspect any equipment at any time, and remove from service any equipment which, in Agency’s sole discretion, is in an unacceptable condition.



c. At Agency’s sole discretion, direct the Contractor to cease Work. The Contractor shall resume Work only upon receipt of approval from Agency.

d. Direct the Contractor to permanently remove from Agency property any employee for conduct, if such conduct is not in compliance with Agency’s Code of Conduct.

4.1 PARTNERING

A. The Agency strongly supports the concept of a partnering process. This process attempts to establish working relationships among the parties through a voluntary, mutually developed, formal strategy of commitment and communication. This process attempts to create an environment where trust and teamwork prevent disputes, foster a cooperative bond to everyone’s benefit, and facilitate the completion of a successful project. Partnering will be structured to draw on strengths of each organization to identify and achieve reciprocal goals. The objectives are effective and efficient Contract performance so that the Work can be completed on schedule, within budget and in compliance with the Contract.

B. Parties to the partnering process may include Agency Departments, the Contractor, and others. The Agency and the Contractor will make arrangements to determine attendees and the agenda for the meetings.

C. The partnering process contemplates an initial meeting between the parties that will facilitate the partnering relationship throughout the Contract term. If warranted and agreed to by the parties, subsequent follow-up partnering meetings may be held during the Contract term. The initial meeting should be held within thirty (30) calendar days after Notice to Proceed, will take place within the Agency service area, and will not be more than two (2) consecutive days in length. Prior to the meeting the Agency and the Contractor will agree on the part-nering facilitator (consultant), the location, refreshments (excluding alcoholic beverages), and meals. Any cost associated with the partnering process shall be agreed to and shared equally by the Agency and the Contractor.

D. The Contractor shall pay the invoices for the actual cost incurred for the partnering meetings held in accordance with the agreement delineated in subparagraph (C) above. Backup documents for the actual cost shall be submitted to the Agency for reimbursement after the meeting. The Agency will reimburse the Contractor for one half the costs. Reimbursement for the Contractor shall not include markup of any kind. Any partnering meetings held subsequent to the initial meeting shall be subject to the same terms and conditions as established in this sub-paragraph.

E. Any costs incurred by the Contractor that are not agreed to and paid under subparagraph C. and D. above, shall be paid by the Contractor at no change in the Contract Amount.

F. The establishment of a partnering charter on a project shall not change the legal relationship of the parties to the Contract nor shall relieve either Party from any of the terms of the Contract.



4.2 STANDARD WORK SCHEDULE

Work scheduled and performed by Contractor on Agency’s premises or items delivered to Agency, shall be performed within Agency working hours and shall account for Agency’s observed holidays.

4.3 INTERFERENCE WITH OPERATIONS

Contractor shall not interfere with normal operation of Agency’s facilities or equipment, or the work of another contractor(s) or subcontractor(s) on Agency's premises. When Contractor anticipates unavoidable interference, it shall so notify Agency at least 14 days in advance. Agency’s representative will determine, in advance, whether such interference is unavoidable and will, if required, establish the necessary procedures under which the interference will be allowed. Agency will have final determination of priorities in case of conflicts with the operations of others. Contractor shall not operate any of Agency's equipment or control devices or those of any other contractor or subcontractor on Agency’s premises, except in the performance of work covered by Contract or at the direction and under the immediate supervision of Agency’s representative.

4.4 ASSIGNMENT AND SUBCONTRACTING

Contractor shall not assign any of its rights or subcontract any of its responsibilities under this Contract without the written consent of Agency, such consent not to be unreasonably withheld by Agency. Contractor shall include in each subcontract any provisions necessary to make all of the provisions of this contract binding on the Subcontractor through its contract with the Contractor. Contractor shall provide any and all information, documents, plans, specifications, and instructions necessary to enable its suppliers and Subcontractors to properly perform their Work.

Agency reserves the right to assign its rights and responsibilities under this Contract at any time and at its sole discretion.

4.5 SUBSTITUTION OF SUBCONTRACTORS

Contractor shall request in writing Agency's written approval before replacing a Subcontractor, such approval not to be unreasonably withheld by Agency. If Contractor wishes to replace a DBE Subcontractor, Contractor shall use good faith efforts to substitute another qualified DBE Subcontractor for the DBE Subcontractor.

4.6 CONSULTANT’S AUTHORITY

If at any time during the contract period Agency chooses to hire third party Consultant(s) for reasons deemed necessary by Agency, the following shall apply:

Agency may employ Consultant(s) in any manner it sees fit in connection with the Contract, including but not limited to having the consultant(s) participate in any or all meetings with the Contractor, review and comment on any or all documents from the Contractor, and witness and assist in the conduct of any or all work, wherever conducted. The Consultant(s) shall act as advisor in all aspects to Agency.



Agency may give the Consultant(s) the authority to act on behalf of Agency or other Valley Metro agencies. In the absence of a written statement setting forth the Consultant's authority, Contractor shall not accept any instructions, written or oral, directly from the Consultant(s).

4.7 APPROVALS

As called for in this Contract, Contractor may provide documents for approval by Agency. Any approval or conditional approval with comment signifies permission to Contractor to proceed with the work and indicates, but does not warrant, that Agency has seen nothing in the document at variance with the Contract. The Contractor's proceeding with the work prior to this approval is at the Contractor's own risk. Neither approval nor conditional approval with comment shall relieve Contractor of any of its responsibilities under the Contract.

4.8 CONTRACT WORK HOURS

4.9.1. Overtime requirements. No contractor or subcontractor contracting for any part of the contract work which may require or involve the employment of laborers or mechanics shall require or permit any such laborer or mechanic in any workweek in which he or she is employed on such work to work in excess of forty hours in such workweek unless such laborer or mechanic receives compensation at a rate not less than one and one-half times the basic rate of pay for all hours worked in excess of forty hours in such workweek.

4.9.2. Violation; liability for unpaid wages; liquidated damages. In the event of any violation of the clause set forth in paragraph 4.9.1 of this section Contractor and any subcontractor responsible therefore shall be liable for the unpaid wages. In addition, such Contractor and subcontractor shall be liable to the Agency for liquidated damages. Such liquidated damages shall be computed with respect to each individual laborer or mechanic, including watchmen and guards, employed in violation of the clause set forth in this section, in the sum of $10 for each calendar day on which such individual was required or permitted to work in excess of the standard workweek of forty hours without payment of the overtime wages required by the clause set forth in paragraph 4.9.1 of this section.

4.9.3. Withholding for unpaid wages and liquidated damages. The Agency shall upon its own action or upon written request of an authorized representative of the Department of Labor withhold or cause to be withheld, from any moneys payable on account of work performed by Contractor or subcontractor under any such contract or any other Federal contract with the same prime contractor, or any other federally-assisted contract subject to the contract Work Hours and Safety Standards Act, which is held by the same prime contractor, such sums as may be determined to be necessary to satisfy any liabilities of such Contractor or subcontractor for unpaid wages and liquidated damages as provided in the clause set forth in paragraph 4.9.2 of this section.

4.9.4. Subcontracts. Contractor or subcontractor shall insert in any subcontracts the clauses set forth in this section and also a clause requiring the subcontractors to include these clauses in any lower tier subcontracts. The prime contractor shall be responsible for compliance by any subcontractor or lower tier subcontractor with the clauses set forth in this section.



4.9.5. Payrolls and basic records. (I) Payrolls and basic records relating thereto shall be maintained by Contractor during the course of the work and preserved for a period of three years thereafter for all laborers and mechanics working at the site of the work. Such records shall contain the name, address, and social security number of each worker, his or her correct classification, hourly rates of wages paid (including rates of contributions or costs anticipated for bona fide fringe benefits or cash equivalents thereof of the types described in Section 1(b)(2)(B) of the Davis-Bacon Act), daily and weekly number of hours worked, deductions made and actual wages paid. Whenever the Secretary of Labor has found under 29 CFR 5.5(a)(1)(iv) that the wages of any laborer or mechanic include the amount of any costs reasonably anticipated in providing benefits under a plan or program described in Section 1(b)(2)(B) of the Davis-Bacon Act, Contractor shall maintain records which show that the commitment to provide such benefits is enforceable, that the plan or program is financially responsible, and that the plan or program has been communicated in writing to the laborers or mechanics affected, and records which show the costs anticipated or the actual cost incurred in providing such benefits. Contractors employing apprentices or trainees under approved programs shall maintain written evidence of the registration of apprenticeship programs and certification of trainee programs, the registration of the apprentices and trainees, and the ratios and wage rates prescribed in the applicable programs.

4.9 CONTRACT ADMINISTRATION

To ensure contract compliance, a contract administration process will be an integral part of contract. Agency employees will be assigned as contract monitors. The contract administration process is an audit and feedback system and will be in addition to any of the other policies and procedures contained in the Contract. The contract administration process is a total quality management tool that empowers Agency to monitor and assure contract compliance. The Contractor may be closely monitored for contract compliance. No additional cost is anticipated to be incurred by Contractor by the presence of the contract administration process as long as contract compliance is maintained. Except for the more formalized feedback of findings, the normal Contractor/Owner relationship will exist per contract terms, and the contract administration process should be transparent.

4.10 CONTRACT CLOSEOUT

At the end of the contract period and as a process of Contract Closeout, Agency will review the service provided during the Contract Time to ensure all required deliverables have been met. This includes, but is not limited to, an audit of financial and operational records, submission and acceptance of all reports and inspection and inventory of all Agency equipment and facilities provided to Contractor for the execution of the contract. Contractor shall resolve any or all-outstanding issues within 30 days of contract expiration at which time Agency will issue a Notice of Contract Closure to Contractor to finalize the Contract Closure between both parties. Contractor shall keep all records pertaining to the service for a minimum of three (3) years after the contract expiration and make available said records to Agency or its agents for audit, with advance notice. In the event of litigation or claims, all records will be maintained until disposition of the litigation or claim.



Contractor shall cooperate with Agency and its agents in the contract closeout process, during the contract and after the contract expiration date. Final payment or part thereof, may be withheld by Agency until the Contractor completes or resolves all outstanding issues and contract closeout process is complete.

SECTION 5 - PERFORMANCE AND PROGRESS

5.0 CHANGES IN THE WORK

A. Agency may, at any time, without notice to the sureties, make changes in the Work within the general intent and scope of the Contract.

B. The Contractor shall promptly notify Agency in writing when the Contractor has received direction, instruction, interpretation or determination from any source which the Contractor believes may cause any change in the Contract Amount or time required for the performance of the Work. Such written notification shall state (1) the date, circumstances, and source of the order and (2) the reasons why the Contractor regards the order as a change. Such notice of a change shall be given to Agency before the Contractor acts on said direction, instruction, interpretation or determination and the Agency shall reply in writing within fourteen (14) Days after its receipt.

C. The Contractor may request additional compensation or additional time or both for Work through a Change Request. For any Change Request which has merit, Agency will initiate a change to the Contract as provided in this section. If the request for change is denied and the Contractor believes the request has merit, the Contractor may proceed in accordance with the provisions of Section 2.15 (Claims).

D. If any change under this section causes an increase or decrease in the Contract Amount, or the time required for the performance of any of the Work under this Contract, Agency shall make an equitable adjustment and modify the Contract by a written Change Order.

E. For any change requested by Agency or Contractor, Contractor shall submit, within fourteen (14) Days of the request, a detailed cost and schedule proposal supported with documentation that (1) reflects all Costs and time-related impacts to the Contract. The proposal shall include a complete breakdown of Direct Labor Costs, Overhead Costs, Other Direct Costs and Fixed Fee(s) of both deletions and additions directly attributable to the proposed change in the Work.

F. For all changes under this section, the Agency and the Contractor shall negotiate a settlement of the cost and time related impacts of the change. A negotiated Change Order shall set out Costs, Fixed Fee(s), scheduling requirements, time extensions and all costs of any nature arising out of the change. Negotiated Fixed Fee amounts shall not exceed ____% of the estimated Costs of the change. The execution of a Change Order by both Parties will be deemed as a resolution of all claims of any nature arising from or relating to the change.

G. In the event that a change in the Work is time sensitive, Agency may direct the Contractor to proceed with the performance of the Work in question by issuance



of a Force Account Change Order. When Contractor performs Work which the Contractor contends is additional or changed Work under this section before agreement to a Contract adjustment is reached, Contractor shall keep daily records of the Costs incurred in connection with such Work and submit daily timesheets to Agency. Agency’s action in approving timesheets submitted by the Contractor shall not be construed as acceptance of the Contractor’s position regarding the need for or magnitude of an equitable adjustment for such Work.

H. In the event that Contractor and Agency are unable to agree on the amount of any adjustment to be made to the Contract Amount or time, Agency may order the Contractor to proceed with the performance of the Work in question. Such Work will be paid for pursuant to a unilateral Change Order issued by Agency. The Contractor when so ordered shall immediately proceed with the Work as changed. Relative to any disputed Contract Amount or time adjustment, the Contractor may seek remedy pursuant to Section 2.15 (Claims).

I. Contractor shall proceed with any Work ordered under this section in a timely manner so as to avoid delay and minimize any increase in time required for performance of the Work but, in no event, shall Contractor proceed with such Work without a fully executed Change Order or written order from Agency to so proceed. An inadvertent payment made by Agency for Work not specifically authorized in writing by Agency shall not be evidence or acknowledgement of Agency’s liability.

J. In no event shall Contractor, nor subcontractors, be entitled to compensation for loss of anticipated profits (Fixed Fees) or for consequential damages resulting from changes made in accordance with this section.

SECTION 6 - PAYMENT

6.0 COMPENSATION

A. Costs

The Agency shall compensate the Contractor for Work satisfactorily performed hereunder on a Cost Plus Fixed Fee (CPFF) basis as further described below. The Agency shall not be liable for any compensation to the Contractor in excess of the Contract Amount unless otherwise approved and agreed to in writing by the Agency. The types of Costs eligible for compensation hereunder are actual Direct Labor Costs, Overhead Costs and Other Direct Costs reasonably incurred by the Contractor, and subcontractors, for the performance of Work hereunder. The Agency shall compensate Contractor, and subcontractors, for actual Direct Labor Costs by paying a sum equal to the labor rates specified in Exhibit B – Cost Schedule multiplied by the hours worked by each person actively employed on the Contract. No premium overtime hours shall be charged to the Agency without specific, advance written approval from the Agency.



Contractor, and subcontractors, may escalate salaries up to _____ percent (_____%) within a twelve (12) month interval, for persons actively employed on the Contract, to be distributed within the discretion of the Contractor, and subcontractors. However, salary escalation monies cannot be used for any other purpose other than annual salary adjustments. Actual labor rates shall be certified by the Contractor, and subcontractors. The Agency shall compensate Contractor, and subcontractors, for Overhead Costs by paying a sum equal to Direct Labor Costs multiplied by specified Overhead Rates, expressed as a percentage, in accordance with Exhibit B – Cost Schedule and as established pursuant to this section. The Overhead Rate for the Contractor, and each subcontractor, shall be determined in accordance with Federal Acquisition Regulation, 48 CFR, Chapter 1, Part 31, as may be established by a cognizant Federal or State government agency or an independent auditor. Contractor, and subcontractors, shall use the most current federally acceptable audited rate pursuant to this section until a more current audit of Overhead Rate is obtained or until the Contractor, or subcontractor, can establish to the reasonable satisfaction of the Agency that other information is available that would indicate a rate adjustment is in order. Notwithstanding any contrary provision contained herein, the Overhead Rate(s) for Contractor, and any Subcontractor, shall not exceed ________%. The Agency shall compensate Contractor, and subcontractors, for actual and reasonable Other Direct Costs incurred as specified in Exhibit B – Cost Schedule without mark-up. No Overhead Costs or Fixed Fee of any nature shall be applied to Other Direct Costs.

B. Fixed Fee(s)

In addition to compensation for Costs pursuant to this section, Agency shall pay Contractor a Fixed Fee in the amount of $_____________. The Fixed Fee shall not vary with actual Costs. One-Sixtieth (1/60th) of the Fixed Fee shall be paid to the Contractor monthly. Subcontractor Fixed Fees shall be considered as a Cost to the Contractor and shall be reimbursed by the Agency without mark-up. Contractor, and subcontractor, Fixed Fees shall be subject to negotiation between the Parties.

C. 75% Notification

Within 30 days of the expenditure of 75% of the Contract Amount, the Contractor shall notify the Agency in writing when the Contractor believes that the cumulative expenditure of Costs and Fixed Fee will reach 100% of the Contract Amount. The notice shall include the following:

(1) Date on which the Contractor expects to reach this 100% level; and

(2) Contractor’s best judgment of whether the Work can be completed within the Contract Amount. If, however, the Work cannot be completed within the Contract Amount, the Contractor shall provide its best estimate of:



a) The additional cost required to complete all Work. Costs include Direct Labor Costs, Overhead Costs and Other Direct Costs;

b) Proposed changes to the Work which would allow the Work to be completed within the Contract Amount; and

c) A statement setting forth in detail the reasons why the Work cannot be completed within the Contract Amount.

If the Contractor’s notice states that the Work cannot be completed within the Contract Amount, the Agency may issue a Change Order pursuant to Section 5.0 increasing authorized Costs amounts, without additional Fixed Fee. Until issuance of a Change Order, the Contractor shall proceed with the Work until the cumulative amount of reimbursable Costs and Fixed Fee equals the Contract Amount.

If it becomes necessary to modify the Contract to eliminate portions of the Work that would allow the remaining portions of the Work to be completed within the Contract Amount, the Contractor’s Costs and Fixed Fee may be renegotiated accordingly, pursuant to the Contract. In no event is the Contractor authorized to incur costs in excess of the Contract Amount, without a prior written Change Order to the Contract. Any such costs incurred without a prior written Change Order to the Contract shall not be reimbursable hereunder.

6.1 PAYMENT

The Contractor shall submit a monthly invoice to Agency for Work performed.

A. Payment Procedures

(1) Invoices for payment, as well as any Change Orders issued hereto, shall be submitted by the Contractor to the Project Manager for processing. Each invoice shall be supported, as required by the Contract or as otherwise requested by the Project Manager, to include cost breakdowns. Each invoice shall include:

(a) Contract number; (b) total invoiced amount; (c) sufficient documentation required by Agency evidencing Work

performed and/or costs incurred; and (d) a Certificate and Release Form.

(2) The Contractor shall certify, in each invoice, that (1) the Work invoiced has

been completed and approved by the Project Manager and performed in accordance with the requirements of the Contract; and (2) all labor and materials consumed have been paid for in full and that the Work is not subject to liens or claims on account thereof.

(3) In the event payments made to the Contractor under the Contract are

subsequently disallowed by Agency due to accounting errors or changes not in conformity with the Contract, the Contractor shall immediately refund such amounts to Agency or credit them on Contractors next invoice, as the Agency may direct.



(4) After receipt, the invoice will be reviewed and evaluated by the Agency’s Project Manager prior to approval. The Project Manager will verify that all Work covered by the invoice has been performed in accordance with the requirements of the Contract.

(5) The Agency will pay the approved invoice within thirty (30) Days of Agency's approval of the invoice. Payments shall not be construed as relieving the Contractor from sole responsibility for all Work upon which payments have been made and the restoration of all defective Work, or as waiving the right of Agency to require the fulfillment of all of the requirements of the Contract.

(6) Agency shall not be required to pay, for any reason whatsoever, any interest on any payments or sums due to the Contractor pursuant to the Contract.

6.2 PROMPT PAYMENT

The Contractor agrees to pay each Subcontractor under this Contract for satisfactory performance of its contract no later than seven (7) Days from the receipt of each payment the Contractor receives from Agency. This clause applies to both DBE and non-DBE subcontractors.

6.3 ACCOUNTING AND AUDITS

Contractor shall keep and maintain full and complete records and books of account of Contractor’s Costs relating to Work performed hereunder in accordance with generally accepted accounting practices. Agency shall have the right to examine and audit, upon reasonable advance notice in writing, any books, records, accounts, and other documents of Contractor directly pertaining to Costs when such Costs are the basis of a claim or of reimbursement to Contractor hereunder. In the event that any examination or audit of Costs incurred hereunder determines that such Costs are to be disallowed, Contractor shall immediately remit such amounts to the Agency. Should either Party dispute any examination or audit finding, such dispute shall be resolved in accordance with Section 2.15 (Claims). All subcontracts shall contain a similar provision allowing for such examinations and audits, as applicable.

SECTION 7 - FEDERAL AND OTHER LEGAL REQUIREMENTS

7.0 FEDERAL REQUIREMETNS

This Contract is funded in part under a financial assistance agreement between Agency and the U.S. Department of Transportation, Federal Transit Administration ("FTA"). This Contract is subject to all provisions prescribed for third party contracts by that financial assistance agreement.

7.1 FEDERAL FUNDING LIMITATION

Contractor understands that funds to pay for Contractor's performance under this Contract may be made available from the United States Department of Transportation through the Federal Transit Administration (FTA). Such funds must be approved and administered by FTA. Agency's obligation hereunder is payable from funds that are appropriated and allocated by FTA for the performance of this Contract. If funds are not allocated, or ultimately are disapproved by FTA, Agency may terminate or suspend Contractor's services without



penalty. Agency shall notify Contractor promptly in writing of the non-allocation, delay, or disapproval of funding.

.Contractor and Subcontractor Obligation. Contractor and/or Subcontractor shall not discriminate on the basis of race, color, national origin, or sex in the performance of this Contract. The Contractor shall carry out applicable requirements of 49 CFR Part 26 in the award and administration of DOT-assisted Contracts. Failure by the Contractor to carry out these requirements is a material breach of this Contract, which may result in the termination of this Contract or such other remedy as the Agency deems appropriate.

7.2 CONTRACTOR LICENSE REQUIREMENT

Contractor shall procure all permits and licenses, and pay all charges and fees necessary and incidental to the lawful conduct of their business. Contractors shall keep themselves fully informed of existing and future Federal, State, and Local laws, ordinances and regulations, which in any manner affect the fulfillment of Contract and shall comply with the same.

Proposers are advised to contact the Arizona Registrar of Contractors, Chief of Licensing, at (602) 542-1502 to ascertain licensing requirements for a particular contract. Proposers shall identify which license(s), if any, the Registrar of Contractors requires for performance of the contract.

7.3 BUY AMERICA

Contractor shall conform to the Buy America Act as fully described in 49 U.S.C. 5323 (j) and 49 CFR Part 661, which provide that Federal funds may not be obligated unless steel, iron, and manufactured products used in FTA-funded projects are produced in the United States, unless a waiver has been granted by FTA or the product is subject to a general waiver. General waivers are listed in 49 CFR 661.7

Contractor must submit to the Agency the appropriate Buy America certification with where applicable, except those subject to a general waiver.

7.4 CARGO PREFERENCE

Contractor agrees:

To use privately owned United States-flag commercial vessels to ship at least 50 percent of the gross tonnage (computed separately for dry bulk carriers, dry cargo liners, and tankers) involved, whenever shipping any equipment, materials, or commodities pursuant to this section, to the extent such vessels are available at fair and reasonable rates for United States-flag commercial vessels.

To furnish within 20 working days following the date of loading for shipments originating within the United States, or within 30 working Days following the date of loading for shipment originating outside the United States, a legible copy of a rated, "on-board" commercial ocean bill-of-lading in English for each shipment of cargo described in the preceding paragraph to the Division of National Cargo, Office of Market Development, Maritime Administration, Washington, DC 20590, and to Agency (through the Contractor



in the case of a subContractor’s bill-of-lading) marked with appropriate identification of the Project.

To include these requirements in all subContracts issued pursuant to this Contract when the subContract may involve the transport of equipment, material, or commodities by ocean vessel.

7.5 FLY AMERICA

If this Contract involves the international transportation of goods, equipment, or personnel by air, Contractor agrees 1) to use U.S. flag carriers, to the extent service by these carriers is available and 2) to include this requirement in subcontracts at every tier. 49 U.S.C. 40118 and 4 CFR Part 52.

7.6 ENERGY CONSERVATION

The Contractor shall comply with mandatory standards and policies relating to energy efficiency which are contained in the State energy conservation plan issued in compliance with the Energy Policy and Conservation Act (42 USC Section 6321, et seq.).

7.7 CLEAN WATER REQUIREMENTS

If the total value of this Contract exceeds $100,000:

(1) The Contractor agrees to comply with all applicable standards, orders or regulations issued pursuant to the Federal Water Pollution Control Act, as amended, 33 U.S.C. 1251 et seq. The Contractor agrees to report each violation to Agency and understands and agrees that Agency will, in turn, report each violation as required to assure notification to FTA and the appropriate EPA Regional Office.

(2) The Contractor also agrees to include these requirements in each subContract exceeding $100,000 financed in whole or in part with Federal assistance provided by the FTA.

7.8 CLEAN AIR

If the total value of this Contract exceeds $100,000:

(1) The Contractor agrees to comply with all applicable standards, orders or regulations issued pursuant to the Clean Air Act, as amended, 422 U.S.C. 7401 et seq. The Contractor agrees to report each violation to Agency and understands and agrees that Agency will, in turn, report each violation as required to assure notification to FTA and the appropriate EPA Regional Office.

(2) The Contractor also agrees to include these requirements in each subContract exceeding $100,000 financed in whole or in part with Federal assistance provided by FTA.

7.9 SUBSTANCE ABUSE

To the extent applicable, Contractor agrees to comply with the following Federal substance abuse regulations:



a. Drug and Alcohol Testing. FTA regulations, “Procedures for Transportation Workplace Drug and Alcohol Testing Programs,” 49 CFR Part 40, and,

b. Alcohol Misuse and Drug Use. FTA regulations, "Prevention of Alcohol Misuse and

Prohibited Drug Use in Transit Operations," 49 CFR Part 655. 7.10 LABOR MANAGEMENT

Contractor shall provide labor contract negotiations and administration of contract terms as required for services under this Contract. Contractor must adhere to all applicable state and federal labor laws and union agreements to the extent they may apply to the Work.

7.11 DEBARRED CONTRACTOR AND SUBCONTRACTOR

Certification Regarding Debarment, Suspension, and Other Responsibility Matters - Lower Tier-covered Transactions (Third Party Contracts over $100,000).

Contractor’s certification as included in Attachment B of this Contract provides:

A. The certification in this provision is a material representation of fact upon which reliance was placed by Agency when it entered into this transaction. If it is later determined that the Contractor knowingly rendered an erroneous certification, in addition to other remedies available to the Federal Government, Agency may pursue available remedies, including suspension and/or debarment.

B. The Contractor shall provide immediate written notice to Agency if at any time the Contractor learns that its certification was erroneous when submitted or has become erroneous by reason of changed circumstances.

C. The terms covered “transaction”, “debarred”, “suspended”, “ineligible”, “lower tier-covered transaction”, “participant”, “persons”, “principal”, “proposal”, and “voluntarily excluded”, as used in this provision, have the meanings set out in the Definitions and Coverage sections of rules implementing Executive Order 12549 [49 CFR Part 29]. Contractor may contact Agency for assistance in obtaining a copy of those regulations.

D. The Contractor agrees that it shall not knowingly enter into any lower tier covered transaction with a person who is debarred, suspended, declared ineligible, or voluntarily excluded from participation in this covered transaction, unless authorized in writing by Agency.

E. The Contractor agrees that it will include the provision titled Certification Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion - Lower Tier Covered Transaction, without modification, in all lower tier covered transactions and in all solicitations for lower tier covered transactions.

F. A participant in a covered transaction may rely upon a certification of a prospective participant in a lower tier covered transaction that is not debarred, suspended, ineligible, or voluntarily excluded from the covered transaction, unless it knows that the certification is erroneous. A participant may decide the



method and frequency by which it determines the eligibility of its principals. Each participant may, but is not required to, check the Non-procurement List issued by U.S. General Service Administration.

G. Nothing contained in the foregoing shall be construed to require establishment of system of records in order to render in good faith the certification required by this clause. The knowledge and information of a participant is not required to exceed that which is normally possessed by a prudent person in the ordinary course of business dealings.

H. Except for transactions authorized under these instructions, if a participant in a covered transaction knowingly enters into a lower tier covered transaction with a person who is suspended, debarred, ineligible, or voluntarily excluded from participation in this transaction, in addition to all remedies available to the Federal Government, Agency may pursue available remedies including suspension and/or debarment. Neither Contractor nor any officer or controlling interest holder of the Contractor, is currently, or has been previously, on a debarred list maintained by the United States Government.

7.12 LOBBYING

Definitions. As used in this clause 8 only,

"Agency", as defined in 5 U.S.C. 552(f), includes Federal executive departments and agencies as well as independent regulatory commissions and Government corporations, as defined in 31 U.S.C. 9101(1).

"Covered Federal action" means any of the following Federal actions:

(1) The awarding of any Federal Contract;

(2) The making of any Federal grant;

(3) The making of any Federal loan;

(4) The entering into of any cooperative agreement; and,

(5) The extension, continuation, renewal, amendment, or modification of any Federal Contract, grant, loan, or cooperative agreement.

Covered Federal action does not include receiving from an Agency a commitment providing for the United States to insure or guarantee a loan. "Indian tribe" and "tribal organization" have the meaning provided in Section 4 of the Indian self-determination and Education Assistance Act (25 U.S.C. 450B). Alaskan Natives are included under the definitions of Indian tribes in that Act.

"Influencing or attempting to influence" means making, with the intent to influence, any communication to or appearance before an officer or employee of any Agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with any covered Federal action.

"Local government" means a unit of government in a State and, if chartered, established, or otherwise recognized by a State for the performance of a



governmental duty, including a local public authority, a special district, an intrastate district, a council of governments, a sponsor group representative organization, and any other instrumentality of a local government.

"Officer or employee of an Agency" includes the following individuals who are employed by an Agency:

(1) An individual who is appointed to a position in the Government under title 5, U.S. Code, including a position under a temporary appointment;

(2) A member of the uniformed services as defined in Section 101(3), title 37, U.S. Code;

(3) A special Government employee as defined in Section 202, title 18, U.S. Code; and,

(4) An individual who is a member of a Federal advisory committee, as defined by the Federal Advisory Committee Act, title 5, U.S. Code appendix 2.

"Person" means an individual, corporation, company association, authority, firm, partnership, society, State, and local government, regardless of whether such entity is operated for profit or not for profit. This term excludes an Indian tribe, tribal organization, or any other Indian organization with respect to expenditures specifically permitted by other Federal law.

"Reasonable compensation" means, with respect to a regularly employed officer or employee of any person, compensation that is consistent with the normal compensation for such officer or employee for work that is not furnished to, not funded by, or not furnished in cooperation with the Federal Government. "Reasonable payment" means, with respect to professional and other technical services, a payment in an amount that is consistent with the amount normally paid for such services in the private sector. "Recipient" includes all Contractors and subcontractors at any tier in connection with a Federal Contract. The term excludes an Indian tribe, tribal organization, or any other Indian organization with respect to expenditures specifically permitted by other Federal law.

"Regularly employed" means, with respect to an officer or employee of a person requesting or receiving a Federal Contract, an officer or employee who is employed by such person for at least 130 working Days within one year immediately preceding the date of the submission that initiates Agency consideration of such person for receipt of such Contract. An officer or employee who is employed by such person for less that 130 working Days within one year immediately preceding the date of the submission that initiates Agency consideration of such person shall be considered to be regularly employed as soon as he or she is employed by such person for 130 working Days.

"State" means a State of the United States, the District of Columbia, the Commonwealth of Puerto Rico, a territory or possession of the United States, an Agency or instrumentality of a State, and a multi-State, regional, or interstate entity having governmental duties and powers.



Prohibition

(1) Section 1352 of title 31, U.S. Code provides in part that no appropriated funds may be expended by the recipient of a Federal Contract, grant, loan, or cooperative agreement to pay any person for influencing or attempting to influence an officer or employee of any Agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with any of the following covered Federal actions: the awarding of any Federal Contract, the making of any Federal grant, the making of any Federal loan, the entering into of any cooperative agreement, and the extension, continuation, renewal, amendment, or modification of any Federal Contract, grant, loan, or cooperative agreement.

(2) The prohibition does not apply as follows:

(i) Agency and legislative liaison by Own Employees.

(a) The prohibition on the use of appropriated funds, in paragraph B (1) of this section, does not apply in the case of a payment of reasonable compensation made to an officer or employee of a person requesting or receiving a Federal Contract if the payment is for Agency and legislative liaison activities not directly related to a covered Federal action.

(b) For purposes of paragraph B (2) (i) (a) of this section, providing any information specifically requested by an Agency or Congress is allowable at any time.

(c) For purposes of paragraph B (2) (i) (a) of this section the following Agency and legislative liaison activities are allowable at any time only where they are not related to a specific solicitation for any covered Federal action:

(1) Discussing with an Agency (including individual demonstrations) the qualities and characteristics of the person's products or services, conditions or terms of sale, and service capabilities; and,

(2) Technical discussions and other activities regarding the application or adaptation of the person's products or services for an Agency's use.

(d) For purposes of paragraph B (2) (i) (a) of this section, the following Agency and legislative liaison activities are allowable only where they are prior to formal solicitation of any covered Federal action:

(1) Providing any information not specifically requested but necessary for an Agency to make an informed decision about initiation of a covered Federal action;



(2) Technical discussions regarding the preparation of an unsolicited proposal prior to its official submission; and,

(3) Capability presentations by persons seeking awards from an Agency pursuant to the provisions of the Small Business Act, as amended by Public Law 95-507 and other subsequent amendments.

(e) Only those activities expressly authorized by paragraph B (2) (i) of this section are allowable under paragraph B (2) (i).

(ii) Professional and technical services by Own Employees.

(a) The prohibition on the use of appropriated funds, in paragraph B (1) of this section, does not apply in the case of a payment of reasonable compensation made to an officer or employee of a person requesting or receiving a Federal Contract or an extension, continuation, renewal, amendment, or modification of a Federal Contract if payment is for professional or technical services rendered directly in the preparation, submission, or negotiation of any bid, proposal, or application for that Federal Contract or for meeting requirements imposed by or pursuant to law as a condition for receiving that Federal Contract.

(b) For purposes of paragraph B (2) (ii) (a) of this section, "professional and technical services" shall be limited advice and analysis directly applying any professional or technical discipline. For example, drafting of a legal document accompanying a bid or proposal by a lawyer is allowable. Similarly, technical advice provided by an engineer on the performance or operational capability of a piece of equipment rendered directly in the negotiation of a Contract is allowable. However, communications with the intent to influence made by a professional (such as a licensed lawyer) or a technical person (such as a licensed accountant) are not allowable under this section unless they provide advice and analysis directly applying their professional or technical expertise and unless the advice or analysis is rendered directly and solely in the preparation, submission or negotiation of a covered Federal action. Thus, for example, communications with the intent to influence made by a lawyer that do not provide legal advice or analysis directly and solely related to the legal aspects of his or her client's proposal, but generally advocate one proposal over another are not allowable under this section because the lawyer is not providing professional legal services. Similarly, communications with the intent to influence made by an engineer providing an engineering analysis prior to the preparation or submission of a bid or proposal are not allowable under this section since the engineer is providing technical services but not directly in the preparation, submission or negotiation of a covered Federal action.



(c) Requirements imposed by or pursuant to law as a condition for receiving a covered Federal award include those required by law or regulation, or reasonably expected to be required by law or regulation, and any other requirements in the actual award documents.

(d) Only those services expressly authorized by paragraph B (2) (ii) of this section are allowable under paragraph B (2) (ii).

(iii) Reporting for Own Employees.

No reporting is required with respect to payments of reasonable compensation made to regularly employed officers or employees of a person.

(iv) Professional and technical services by Other than Own Employees.

(a) The prohibition on the use of appropriated funds, in paragraph B (1) of this section, does not apply in the case of any reasonable payment to a person, other than an officer or employee of a person requesting or receiving a covered Federal action, if the payment is for professional or technical services rendered directly in the preparation, submission, or negotiation of any bid, proposal, or application for that Federal Contract or for meeting requirements imposed by or pursuant to law as a condition for receiving that Federal Contract.

(b) For purposes of paragraph B (2) (iv) (a) of this section, "professional and technical services" shall be limited advice and analysis directly applying to any professional or technical discipline. For example, drafting of a legal document accompanying a bid or proposal by a lawyer is allowable. Similarly, technical advice provided by an engineer on the performance or operational capability of a piece of equipment rendered directly in the negotiation of a Contract is allowable. However, communications with the intent to influence made by a professional (such as a licensed lawyer) or a technical person (such as a licensed accountant) are not allowable under this section unless they provide advice and analysis directly applying their professional or technical expertise and unless the advice or analysis is rendered directly and solely in the preparation, submission or negotiation of a covered Federal action. Thus, for example, communications with the intent to influence made by a lawyer that do not provide legal advice or analysis directly and solely related to the legal aspects of his or her client's proposal, but generally advocate one proposal over another are not allowable under this section because the lawyer is not providing professional legal services. Similarly, communications with the intent to influence made by an engineer providing an engineering analysis prior to the preparation or submission of a bid or proposal are not allowable under this section since the engineer is



providing technical services but not directly in the preparation, submission or negotiation of a covered Federal action.

(c) Requirements imposed by or pursuant to law as a condition for receiving a covered Federal award include those required by law or regulation, or reasonably expected to be required by law or regulation, and any other requirements in the actual award documents.

(d) Persons other than officers or employees of a person requesting or receiving a covered Federal action include consultants and trade associations.

(e) Only those services expressly authorized by paragraph B (2) (iv) of this section are allowable under paragraph B (2) (iv).

Disclosure

(3) Each person who requests or receives from an Agency a Federal Contract shall file with that Agency a certification, set forth in this document, that the person has not made, and will not make, any payment prohibited by paragraph (b) of this clause.

(4) Each person who requests or receives from an Agency a Federal Contract shall file with that Agency a disclosure form, Standard Form-LLL, "Disclosure of Lobbying Activities," if such person has made or has agreed to make any payment using non-appropriated funds (to include profits from any covered Federal action), which would be prohibited under paragraph (b) of this clause if paid for with appropriated funds.

(5) Each person shall file a disclosure form at the end of each calendar quarter in which there occurs any event that requires disclosure or that materially affects the accuracy of the information contained in any disclosure form previously filed by such person under paragraph C (2) of this section. An event that materially affects the accuracy of the information reported includes:

A cumulative increase of $25,000 or more in the amount paid or expected to be paid for influencing or attempting to influence a covered Federal action; or

A change in the person(s) or individual(s) influencing or attempting to influence a covered Federal action; or,

A change in the officer(s), employee(s), or member(s) contacted to influence or attempt to influence a covered Federal action.

(6) Any person who requests or receives from a person referred to in paragraph (C) (1) of this section a subContract exceeding $100,000 at any tier under a Federal Contract shall file a certification, and a disclosure form, if required, to the next tier above.



(7) All disclosure forms, but not certifications, shall be forwarded from tier to tier until received by the person referred to in paragraph C (1) of this section. That person shall forward all disclosure forms to the Agency.

Penalties

(8) Any person who makes an expenditure prohibited under paragraph B of this clause shall be subject to a civil penalty of not less than $10,000 and not more than $100,000 for each such expenditure.

(9) Any person who fails to file or amend the disclosure form to be filed or amended if required by this clause, shall be subject to a civil penalty of not less than $10,000 and not more than $100,000 for each such failure.

(10) Contractors may rely without liability on the representations made by their subContractors in the certification and disclosure form.

Cost Allowability

Nothing in this clause is to be interpreted to make allowable or reasonable any costs which would be unallowable or unreasonable in accordance with Part 31 of the Federal Acquisition Regulation. Conversely, costs made specifically unallowable by the requirements in this clause will not be made allowable under any of the provisions of Part 31 of the Federal Acquisition Regulation.

7.13 FEDERAL CHANGES

Contractor shall at all times comply with all applicable FTA regulations, policies, procedures and directives, including without limitation those listed directly or by reference in the Contract (Form FTA MA(5) dated October 1, 1999) between the Agency, City of Phoenix as the grantee for the region and the FTA, as they may be amended or promulgated from time to time during the term of this Contract. Contractor’s failure to so comply shall constitute a material breach of this Contract. Should changes to such FTA regulations, policies, procedures and directives occur after the date of execution of this Contract which in the Contractor’s opinion require a change in the Contract Amount or time required for the performance of the Work hereunder, the Contractor shall provide written notification to Agency in accordance with Section 5.0 (Changes in the Work).

7.14 RECYCLED PRODUCTS

The Contractor agrees to comply with all the requirements of Section 6002 of the Resource Conservation and Recovery Act (RCRA), as amended (42 U.S.C. 6962), including but not limited to the regulatory provisions of 40 CFR Part 247, and Executive Order 12873, as they apply to the procurement of the items designated in Subpart B of 40 CFR Part 247.

7.15 NO FEDERAL GOVERNMENT OBLIGATION TO THIRD PARTIES

Agency and Contractor acknowledge and agree that, notwithstanding any concurrence by the Federal Government in or approval of the solicitation or award of Contract, absent the express written consent by the Federal Government, the Federal Government is not a party to this Contract and shall not be subject to any obligations or liabilities to Agency,



Contractor, or any other party (whether or not a party to that Contract) pertaining to any matter resulting from this Contract.

The Contractor agrees to include the above clause in each subContract financed in whole or in part with Federal assistance provided by FTA. It is further agreed that the clause shall not be modified, except to identify the subContractor who will be subject to its provisions.

7.16 COMPLIANCE WITH THE IMMIGRATION REFORM AND CONTROL ACT OF 1986 (IRCA) REQUIRED

Contractor understands and acknowledges the applicability of the IRCA. Contractor agrees to comply with the IRCA in performing under this Contract and to permit Agency inspection of its personnel records to verify such compliance.

7.17 PROGRAM FRAUD AND FALSE OR FRAUDULENT STATEMENT AND RELATED ACTS

The Contractor acknowledges that the provisions of the Program Fraud Civil Remedies Act of 1986 as amended, 31 U.S.C 3801 et seq. and U.S. DOT regulations, “Program Fraud civil Remedies, “ 49 CFR Part 31, apply to its actions on this Project. Upon execution of the Contract, the Contractor certifies or affirms the truthfulness of any statement it has made, it makes, or causes to be made, pertaining to this Contract or the FTA assisted Project for which this Contract work is being performed. In addition to other penalties that may be applicable, the Contractor further acknowledges that if it makes, or causes to be made, a false, fictitious, or fraudulent claim, statement, submission or certification, the Federal Government reserves the right to impose the penalties of the Program Fraud Civil Remedies Act of 1986 on the Contractor to the extent the Federal Government deems appropriate.

The Contractor acknowledges that if it makes, or causes to be made, a false, fictitious, or fraudulent claim, statement, submission, or certification to the Federal Government under a Contract connected with a project that is financed in whole or in part with Federal assistance originally awarded by FTA under the authority of 49 U.S.C. 5307, the Government reserves the right to impose the penalties of 18 U.S.C. 1001 and 49 U.S.C. 5307 (n)(1) on the Contractor, to the extent the Federal Government deems appropriate.

The Contractor agrees to include the above two paragraphs in each subContract financed in whole or in part with Federal assistance provided by FTA. It is further agreed that the clauses shall not be modified, except to identify the subContractor who will be subject to the provisions.

7.18 PRIVACY ACT

The following requirements apply to the Contractor and its employees that administer any system of records on behalf of the Federal Government under any Contract:

The Contractor agrees to comply with, and assures the compliance of its employees with, the information restrictions and other applicable requirements of the Privacy Act of 1974, 5 U.S.C. § 552a. Among other things, the Contractor agrees to obtain the express consent of the Federal Government before the Contractor or its employees operate a system of records on behalf of the Federal Government. The Contractor understands



that the requirements of the Privacy Act, including the civil and criminal penalties for violation of that Act, apply to those individuals involved, and that failure to comply with the terms of the Privacy Act may result in termination of the underlying Contract.

The Contractor also agrees to include these requirements in each subContract to administer any system of records on behalf of the Federal Government financed in whole or in part with Federal assistance provided by FTA.

7.19 CIVIL RIGHTS

Nondiscrimination - In accordance with Title VI of the Civil Rights Act, as amended, 42 U.S.C. § 2000d, Section 303 of the Age Discrimination Act of 1975, as amended, 42 U.S.C. § 6102, Section 202 of the Americans with Disabilities Act of 1990, 42 U.S.C. § 12132, and Federal transit law at 49 U.S.C. § 5332, the Contractor agrees that it will not discriminate against any employee or applicant for employment because of race, color, creed, national origin, sex, age, or disability. In addition, the Contractor agrees to comply with applicable Federal implementing regulations and other implementing requirements FTA may issue.

Equal Employment Opportunity - The following equal employment opportunity requirements apply to the underlying Contract:

(1) Race, Color, Creed, National Origin, Sex - In accordance with Title VII of the Civil Rights Act, as amended, 42 U.S.C. § 2000e, and Federal transit laws at 49 U.S.C. § 5332, the Contractor agrees to comply with all applicable equal employment opportunity requirements of U.S. Department of Labor (U.S. DOL) regulations, "Office of Federal Contract Compliance Programs, Equal Employment Opportunity, Department of Labor," 41 C.F.R. Parts 60 et seq., (which implement Executive Order No. 11246, "Equal Employment Opportunity," as amended by Executive Order No. 11375, "Amending Executive Order 11246 Relating to Equal Employment Opportunity," 42 U.S.C. § 2000e note), and with any applicable Federal statutes, executive orders, regulations, and Federal policies that may in the future affect construction activities undertaken in the course of the Project. The Contractor agrees to take affirmative action to ensure that applicants are employed, and that employees are treated during employment, without regard to their race, color, creed, national origin, sex, or age. Such action shall include, but not be limited to, the following: employment, upgrading, demotion or transfer, recruitment or recruitment advertising, layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. In addition, the Contractor agrees to comply with any implementing requirements FTA may issue.

(2) Age - In accordance with Section 4 of the Age Discrimination in Employment Act of 1967, as amended, 29 U.S.C. § 623 and Federal transit law at 49 U.S.C. § 5332, the Contractor agrees to refrain from discrimination against present and prospective employees for reason of age. In addition, the Contractor agrees to comply with any implementing requirements FTA may issue.

(3) Disabilities - In accordance with Section 102 of the Americans with Disabilities Act, as amended, 42 U.S.C. § 12112, the Contractor agrees that it will comply with the requirements of U.S. Equal Employment Opportunity Commission, "Regulations to Implement the Equal Employment Provisions of the Americans with Disabilities Act," 29



C.F.R. Part 1630, pertaining to employment of persons with disabilities. In addition, the Contractor agrees to comply with any implementing requirements FTA may issue.

The Contractor also agrees to include these requirements in each subContract financed in whole or in part with Federal assistance provided by FTA, modified only if necessary to identify the affected parties.

7.20 INCORPORATION OF FEDERAL TRANSIT ADMINISTRATION TERMS

The preceding provisions include, in part, certain standard terms and conditions required by DOT, whether or not expressly set forth in the preceding Contract provisions. All Contractual provisions required by DOT, as set forth in FTA Circular 4220.1E, are hereby incorporated by reference. Anything to the contrary herein notwithstanding, all FTA mandated terms shall be deemed to control in the event of a conflict with other provisions contained in this Contract. The Contractor shall not perform any act, fail to perform any act, or refuse to comply with any Agency requests which would cause the Agency to be in violation of the FTA terms and conditions.

7.21 SERVICE CONTRACT ACT OF 1965 A. Definitions.

“Act,” as used in this clause, means the Service Contract Act of 1965, as amended (41 U.S.C. 351, et seq.).

“Contractor,” as used in this clause or in any subcontract, shall be deemed to refer to the firm awarded the contract and any subcontractor.

“Service employee,” as used in this clause, means any person engaged in the performance of this contract other than any person employed in a bona fide executive, administrative, or professional capacity, as these terms are defined in Part 541 of Title 29, Code of Federal Regulations, as revised. It includes all such persons regardless of any contractual relationship that may be alleged to exist between a Contractor or subcontractor and such persons.

B. Applicability.

This contract is subject to the following provisions and to all other applicable provisions of the Act and regulations of the Secretary of Labor (29 CFR Part 4). This clause does not apply to contracts or subcontracts administratively exempted by the Secretary of Labor or exempted by 41 U.S.C. 356, as interpreted in Subpart C of 29 CFR Part 4.

C. Compensation.

1. Each service employee employed in the performance of this contract by the

Contractor or any subcontractor shall be paid not less than the minimum monetary wages and shall be furnished fringe benefits in accordance with the wages and fringe benefits determined by the Secretary of Labor, or authorized representative, as specified in any wage determination attached to this contract.



2. (i) If a wage determination is attached to this contract, the Contractor shall classify any class of service employee which is not listed therein and which is to be employed under the contract (i.e., the work to be performed is not performed by any classification listed in the wage determination) so as to provide a reasonable relationship (i.e., appropriate level of skill comparison) between such unlisted classifications and the classifications listed in the wage determination. Such conformed class of employees shall be paid the monetary wages and furnished the fringe benefits as are determined pursuant to the procedures in this paragraph C.

(ii) This conforming procedure shall be initiated by the Contractor prior to the performance of contract work by the unlisted class of employee. The Contractor shall submit Standard Form (SF) 1444, Request For Authorization of Additional Classification and Rate, to the Agency no later than 30 days after the unlisted class of employee performs any contract work. The Agency shall review the proposed classification and rate and promptly submit the completed SF 1444 (which must include information regarding the agreement or disagreement of the employees’ authorized representatives or the employees themselves together with the agency recommendation), and all pertinent information to the Wage and Hour Division, Employment Standards Administration, U.S. Department of Labor. The Wage and Hour Division will approve, modify, or disapprove the action or render a final determination in the event of disagreement within 30 days of receipt or will notify the Agency within 30 days of receipt that additional time is necessary. (iii) The final determination of the conformance action by the Wage and Hour Division shall be transmitted to the Agency who shall promptly notify the Contractor of the action taken. Each affected employee shall be furnished by the Contractor with a written copy of such determination or it shall be posted as a part of the wage determination. (iv)(A) The process of establishing wage and fringe benefit rates that bear a reasonable relationship to those listed in a wage determination cannot be reduced to any single formula. The approach used may vary from wage determination to wage determination depending on the circumstances. Standard wage and salary administration practices which rank various job classifications by pay grade pursuant to point schemes or other job factors may, for example, be relied upon. Guidance may also be obtained from the way different jobs are rated under Federal pay systems (Federal Wage Board Pay System and the General Schedule) or from other wage determinations issued in the same locality. Basic to the establishment of any conformable wage rate(s) is the concept that a pay relationship should be maintained between job classifications based on the skill required and the duties performed.

(B) In the case of a contract modification, an exercise of an option, or extension of an existing contract, or in any other case where a Contractor succeeds a contract under which the classification in question was previously conformed pursuant to paragraph C of this clause, a new conformed wage rate and fringe benefits may be assigned to the conformed classification by indexing (i.e., adjusting) the previous conformed rate and fringe benefits by an amount



equal to the average (mean) percentage increase (or decrease, where appropriate) between the wages and fringe benefits specified for all classifications to be used on the contract which are listed in the current wage determination, and those specified for the corresponding classifications in the previously applicable wage determination. Where conforming actions are accomplished in accordance with this paragraph prior to the performance of contract work by the unlisted class of employees, the Contractor shall advise the Agency of the action taken but the other procedures in subdivision C. 2.(ii) of this clause need not be followed.

(C) No employee engaged in performing work on this contract shall in any event be paid less than the currently applicable minimum wage specified under section 6(a)(1) of the Fair Labor Standards Act of 1938, as amended. (v) The wage rate and fringe benefits finally determined under this paragraph C. 2. of this clause shall be paid to all employees performing in the classification from the first day on which contract work is performed by them in the classification. Failure to pay the unlisted employees the compensation agreed upon by the interested parties and/or finally determined by the Wage and Hour Division retroactive to the date such class of employees commenced contract work shall be a violation of the Act and this contract. (vi) Upon discovery of failure to comply with paragraph C. 2. of this clause, the Wage and Hour Division shall make a final determination of conformed classification, wage rate, and/or fringe benefits which shall be retroactive to the date such class or classes of employees commenced contract work.

3. Adjustment of compensation. If the term of this contract is more than 1 year, the minimum monetary wages and fringe benefits required to be paid or furnished thereunder to service employees under this contract shall be subject to adjustment after 1 year and not less often than once every 2 years, under wage determinations issued by the Wage and Hour Division.

D. Obligation to furnish fringe benefits.

The Contractor or subcontractor may discharge the obligation to furnish fringe benefits specified in the attachment or determined under paragraph C. 2. of this clause by furnishing equivalent combinations of bona fide fringe benefits, or by making equivalent or differential cash payments, only in accordance with Subpart D of 29 CFR Part 4.

E. Minimum wage.

In the absence of a minimum wage attachment for this contract, neither the Contractor nor any subcontractor under this contract shall pay any person performing work under this contract (regardless of whether the person is a service employee) less than the minimum wage specified by section 6(a)(1) of the Fair Labor Standards Act of 1938. Nothing in this clause shall relieve the Contractor or any subcontractor of any other obligation under law or contract for payment of a higher wage to any employee.



F. Successor contracts.

If this contract succeeds a contract subject to the Act under which substantially the same services were furnished in the same locality and service employees were paid wages and fringe benefits provided for in a collective bargaining agreement, in the absence of the minimum wage attachment for this contract setting forth such collectively bargained wage rates and fringe benefits, neither the Contractor nor any subcontractor under this contract shall pay any service employee performing any of the contract work (regardless of whether or not such employee was employed under the predecessor contract), less than the wages and fringe benefits provided for in such collective bargaining agreement, to which such employee would have been entitled if employed under the predecessor contract, including accrued wages and fringe benefits and any prospective increases in wages and fringe benefits provided for under such agreement. No Contractor or subcontractor under this contract may be relieved of the foregoing obligation unless the limitations of 29 CFR 4.1b(b) apply or unless the Secretary of Labor or the Secretary’s authorized representative finds, after a hearing as provided in 29 CFR 4.10 that the wages and/or fringe benefits provided for in such agreement are substantially at variance with those which prevail for services of a character similar in the locality, or determines, as provided in 29 CFR 4.11, that the collective bargaining agreement applicable to service employees employed under the predecessor contract was not entered into as a result of arm’s length negotiations. Where it is found in accordance with the review procedures provided in 29 CFR 4.10 and/or 4.11 and Parts 6 and 8 that some or all of the wages and/or fringe benefits contained in a predecessor Contractor’s collective bargaining agreement are substantially at variance with those which prevail for services of a character similar in the locality, and/or that the collective bargaining agreement applicable to service employees employed under the predecessor contract was not entered into as a result of arm’s length negotiations, the Department will issue a new or revised wage determination setting forth the applicable wage rates and fringe benefits. Such determination shall be made part of the contract or subcontract, in accordance with the decision of the Administrator, the Administrative Law Judge, or the Board of Service Contract Appeals, as the case may be, irrespective of whether such issuance occurs prior to or after the award of a contract or subcontract (53 Comp. Gen. 401 (1973)). In the case of a wage determination issued solely as a result of a finding of substantial variance, such determination shall be effective as of the date of the final administrative decision.

G. Notification to employees.

The Contractor and any subcontractor under this contract shall notify each service employee commencing work on this contract of the minimum monetary wage and any fringe benefits required to be paid pursuant to this contract, or shall post the wage determination attached to this contract. The poster provided by the Department of Labor (Publication WH 1313) shall be posted in a prominent and accessible place at the worksite. Failure to comply with this requirement is a violation of section 2(a)(4) of the Act and of this contract.

H. Safe and sanitary working conditions.



The Contractor or subcontractor shall not permit any part of the services called for by this contract to be performed in buildings or surroundings or under working conditions provided by or under the control or supervision of the Contractor or subcontractor which are unsanitary, hazardous, or dangerous to the health or safety of the service employees. The Contractor or subcontractor shall comply with the safety and health standards applied under 29 CFR Part 1925.

I. Records. 1. The Contractor and each subcontractor performing work subject to the Act shall

make and maintain for 3 years from the completion of the work, and make them available for inspection and transcription by authorized representatives of the Wage and Hour Division, Employment Standards Administration, a record of the following:

(i) For each employee subject to the Act:

(A) Name and address and social security number; (B) Correct work classification or classifications, rate or rates of monetary

wages paid and fringe benefits provided, rate or rates of payments in lieu of fringe benefits, and total daily and weekly compensation;

(C) Daily and weekly hours worked by each employee; and (D) Any deductions, rebates, or refunds from the total daily or weekly

compensation of each employee.

(ii) For those classes of service employees not included in any wage determination attached to this contract, wage rates or fringe benefits determined by the interested parties or by the Administrator or authorized representative under the terms of paragraph C. of this clause. A copy of the report required by subdivision C. 2. (ii) of this clause will fulfill this requirement. (iii) Any list of the predecessor Contractor’s employees which had been furnished to the Contractor as prescribed by paragraph N. of this clause.

(2) The Contractor shall also make available a copy of this contract for inspection or transcription by authorized representatives of the Wage and Hour Division.

(3) Failure to make and maintain or to make available these records for inspection

and transcription shall be a violation of the regulations and this contract, and in the case of failure to produce these records, the Agency, upon direction of the Department of Labor and notification to the Contractor, shall take action to cause suspension of any further payment or advance of funds until the violation ceases.

(4) The Contractor shall permit authorized representatives of the Wage and Hour

Division to conduct interviews with employees at the worksite during normal working hours.

J. Pay periods.

The Contractor shall unconditionally pay to each employee subject to the Act all wages due free and clear and without subsequent deduction (except as otherwise



provided by law or regulations, 29 CFR Part 4), rebate, or kickback on any account. These payments shall be made no later than one pay period following the end of the regular pay period in which the wages were earned or accrued. A pay period under this Act may not be of any duration longer than semi-monthly.

K. Withholding of payments and termination of contract.

The Agency shall withhold or cause to be withheld from the Contractor under this or any other contract with the Prime Contractor such sums as an appropriate official of the Department of Labor requests or such sums as the Agency decides may be necessary to pay underpaid employees employed by the Contractor or subcontractor. In the event of failure to pay any employees subject to the Act all or part of the wages or fringe benefits due under the Act, the Agency may, after authorization or by direction of the Department of Labor and written notification to the Contractor, take action to cause suspension of any further payment or advance of funds until such violations have ceased. Additionally, any failure to comply with the requirements of this clause may be grounds for termination of the right to proceed with the contract work. In such event, the Agency may enter into other contracts or arrangements for completion of the work, charging the Contractor in default with any additional cost.

L. Subcontracts. The Contractor agrees to insert this clause in all subcontracts subject to the Act.

M. Collective bargaining agreements applicable to service employees.

If wages to be paid or fringe benefits to be furnished any service employees employed by the Contractor or any subcontractor under the contract are provided for in a collective bargaining agreement which is or will be effective during any period in which the contract is being performed, the Contractor shall report such fact to the Agency, together with full information as to the application and accrual of such wages and fringe benefits, including any prospective increases, to service employees engaged in work on the contract, and a copy of the collective bargaining agreement. Such report shall be made upon commencing performance of the contract, in the case of collective bargaining agreements effective at such time, and in the case of such agreements or provisions or amendments thereof effective at a later time during the period of contract performance such agreements shall be reported promptly after negotiation thereof.

N. Seniority list.

Not less than 10 days prior to completion of any contract being performed at a facility where service employees may be retained in the performance of the succeeding contract and subject to a wage determination which contains vacation or other benefit provisions based upon length of service with a Contractor (predecessor) or successor (29 CFR 4.173), the incumbent Prime Contractor shall furnish the Agency a certified list of the names of all service employees on the Contractor’s or subcontractor’s payroll during the last month of contract performance. Such list shall also contain anniversary dates of employment on the contract either with the current



or predecessor Contractors of each such service employee. The Agency shall turn over such list to the successor Contractor at the commencement of the succeeding contract.

O. Rulings and interpretations.

Rulings and interpretations of the Act are contained in Regulations, 29 CFR Part 4.

P. Contractor’s certification. (1) By entering into this contract, the Contractor (and officials thereof) certifies that neither it (nor he or she) nor any person or firm who has a substantial interest in the Contractor’s firm is a person or firm ineligible to be awarded Government contracts by virtue of the sanctions imposed under section 5 of the Act. (2) No part of this contract shall be subcontracted to any person or firm ineligible for award of a Government contract under section 5 of the Act. (3) The penalty for making false statements is prescribed in the U.S. Criminal Code, 18 U.S.C. 1001.

Q. Variations, tolerances, and exemptions involving employment.

Notwithstanding any of the provisions in paragraphs B. through O. of this clause, the following employees may be employed in accordance with the following variations, tolerances, and exemptions, which the Secretary of Labor, pursuant to section 4(b) of the Act prior to its amendment by Pub. L. 92-473, found to be necessary and proper in the public interest or to avoid serious impairment of the conduct of business:

(1) Apprentices, student-learners, and workers whose earning capacity is impaired by age, physical or mental deficiency, or injury may be employed at wages lower than the minimum wages otherwise required by section 2(a)(1) or 2(b)(1) of the Act without diminishing any fringe benefits or cash payments in lieu thereof required under section 2(a)(2) of the Act, in accordance with the conditions and procedures prescribed for the employment of apprentices, student-learners, handicapped persons, and handicapped clients of sheltered workshops under section 14 of the Fair Labor Standards Act of 1938, in the regulations issued by the Administrator (29 CFR parts 520, 521, 524, and 525).

(2) The Administrator will issue certificates under the Act for the employment of apprentices, student-learners, handicapped persons, or handicapped clients of sheltered workshops not subject to the Fair Labor Standards Act of 1938, or subject to different minimum rates of pay under the two acts, authorizing appropriate rates of minimum wages (but without changing requirements concerning fringe benefits or supplementary cash payments in lieu thereof), applying procedures prescribed by the applicable regulations issued under the Fair Labor Standards Act of 1938 (29 CFR parts 520, 521, 524, and 525).

(3) The Administrator will also withdraw, annul, or cancel such certificates in accordance with the regulations in 29 CFR parts 525 and 528.



R. Apprentices.

Apprentices will be permitted to work at less than the predetermined rate for the work they perform when they are employed and individually registered in a bona fide apprenticeship program registered with a State Apprenticeship Agency which is recognized by the U.S. Department of Labor, or if no such recognized agency exists in a State, under a program registered with the Office of Apprenticeship Training, Employer, and Labor Services (OATELS), U.S. Department of Labor. Any employee who is not registered as an apprentice in an approved program shall be paid the wage rate and fringe benefits contained in the applicable wage determination for the journeyman classification of work actually performed. The wage rates paid apprentices shall not be less than the wage rate for their level of progress set forth in the registered program, expressed as the appropriate percentage of the journeyman’s rate contained in the applicable wage determination. The allowable ratio of apprentices to journeymen employed on the contract work in any craft classification shall not be greater than the ratio permitted to the Contractor as to his entire work force under the registered program.

S. Tips.

An employee engaged in an occupation in which the employee customarily and regularly receives more than $30 a month in tips may have the amount of these tips credited by the employer against the minimum wage required by section 2(a)(1) or section 2(b)(1) of the Act, in accordance with section 3(m) of the Fair Labor Standards Act and Regulations, 29 CFR Part 531. However, the amount of credit shall not exceed $1.34 per hour beginning January 1, 1981. To use this provision—

(1) The employer must inform tipped employees about this tip credit allowance before the credit is utilized; (2) The employees must be allowed to retain all tips (individually or through a pooling arrangement and regardless of whether the employer elects to take a credit for tips received); (3) The employer must be able to show by records that the employee receives at least the applicable Service Contract Act minimum wage through the combination of direct wages and tip credit; and (4) The use of such tip credit must have been permitted under any predecessor collective bargaining agreement applicable by virtue of section 4(c) of the Act.

T. Disputes concerning labor standards.

The U.S. Department of Labor has set forth in 29 CFR parts 4, 6, and 8 procedures for resolving disputes concerning labor standards requirements. Such disputes shall be resolved in accordance with those procedures and not the Disputes clause of this contract. Disputes within the meaning of this clause include disputes between the Contractor (or any of its subcontractors) and the Agency, the U.S. Department of Labor, or the employees or their representatives.



7.22 CONTRACT WORK HOURS AND SAFETY STANDARDS ACT

40 U.S.C. § 327 -333 (1999) 29 C.F.R. § 5 (1999) 29 C.F.R. § 1926 (1998) and Section 102 of the Act, which deals with overtime requirements, applies to all construction contracts in excess of $2,000 and; Section 107 of the Act which deals with OSHA requirements applies to construction contracts in excess of $2,000 only. The requirements of this section do not apply to contracts or subcontracts for the purchase of supplies or materials or articles normally available on the open market. This Clause applies to third party contractors and subcontractors.

These clauses are specifically mandated under DOL regulation 29 C.F.R. § 5.5 and when preparing a construction contract in excess of $2,000 these clauses should be used in conjunction with the Davis-Bacon Act clauses as discussed previously. For non-construction contracts, this is the only section required along with the payroll section.

Overtime requirements –

(1) No contractor or subcontractor contracting for any part of the contract work which may require or involve the employment of laborers or mechanics shall require or permit any such laborer or mechanic in any workweek in which he or she is employed on such work to work in excess of forty hours in such workweek unless such laborer or mechanic receives compensation at a rate not less than one and one-half times the basic rate of pay for all hours worked in excess of forty hours in such workweek.

Violation; liability for unpaid wages; liquidated damages –

(1) In the event of any violation of the clause set forth in paragraph (A) of this section the contractor and any subcontractor responsible therefore shall be liable for the unpaid wages. In addition, such contractor and subcontractor shall be liable to the Agency for liquidated damages. Such liquidated damages shall be computed with respect to each individual laborer or mechanic, including watchmen and guards, employed in violation of the clause set forth in paragraph (A) of this section, in the sum of $10 for each calendar day on which such individual was required or permitted to work in excess of the standard workweek of forty hours without payment of the overtime wages required by the clause set forth in paragraph (A) of this section.

Withholding for unpaid wages and liquidated damages –

(1) The Agency shall upon its own action or upon written request of an authorized representative of the Department of Labor withhold or cause to be withheld, from any moneys payable on account of work performed by the contractor or subcontractor under any such contract or any other Federal contract with the same prime contractor, or any other federally-assisted contract subject to the Contract Work Hours and Safety Standards Act, which is held by the same prime contractor, such sums as may be determined to be necessary to satisfy any liabilities of such contractor or subcontractor for unpaid wages and liquidated damages as provided in the clause set forth in paragraph (B) of this section.



Subcontracts –

(1) The contractor or subcontractor shall insert in any subcontracts the clauses set forth in this section and also a clause requiring the subcontractors to include these clauses in any lower tier subcontracts. The prime contractor shall be responsible for compliance by any subcontractor or lower tier subcontractor with the clauses set forth in this section.

Contract Work Hours and Safety Standards Act –

(1) The Contractor agrees to comply with Section 107 of the Contract Work Hours and Safety Standards Act, 40 U.S.C. Section 333, and applicable DOL regulations, "Safety and Health Regulations for Construction" 29 C.F.R. Part 1926. Among other things, the Contractor agrees that it will not require any laborer or mechanic to work in unsanitary, hazardous, or dangerous surroundings or working conditions.

Subcontracts - The Contractor also agrees to include the requirements of this section in each subcontract. The term "subcontract" under this section is considered to refer to a person who agrees to perform any part of the labor or material requirements of a contract for construction, alteration or repair. A person who undertakes to perform a portion of a contract involving the furnishing of supplies or materials will be considered a "subcontractor" under this section if the work in question involves the performance of construction work and is to be performed: (1) directly on or near the construction site, or (2) by the employer for the specific project on a customized basis. Thus, a supplier of materials which will become an integral part of the construction is a "subcontractor" if the supplier fabricates or assembles the goods or materials in question specifically for the construction project and the work involved may be said to be construction activity. If the goods or materials in question are ordinarily sold to other customers from regular inventory, the supplier is not a "subcontractor." The requirements of this section do not apply to contracts or subcontracts for the purchase of supplies or materials or articles normally available on the open market.

7.23 COPELAND ANTI-KICKBACK ACT

Per 40 U.S.C. § 276c (1999), 29 C.F.R. § 3 (1999) and 29 C.F.R. § 5 (1999) the Act applies to all construction contracts in excess of $2,000 and shall flow down to all third party contractors and subcontractors.

Section 3.1 of the Copeland Act makes it clear that the purpose of the Act is to assist in "the enforcement of the minimum wage provisions of the Davis- Bacon Act." In keeping with this intent DOL has included a section on the Copeland Act in the mandatory language of the Davis-Bacon provisions. The language can be found at § 5.5(a)(5) of the Davis-Bacon model clauses and reads as follows:

Compliance with Copeland Act requirements - The contractor shall comply with the requirements of 29 CFR part 3, which are incorporated by reference in the RFP and any resultant contract.



7.24 NATIONAL TRANSIT DATABASE REPORTING

Contractor shall collect data, keep records and provide reports sufficient to enable Agency to meet its Federal Transportation Administration NTD reporting requirements. Contractor is responsible for obtaining all pertinent FTA NTD regulations and procedures to ensure that all required information is collected and reported in a timely fashion.

On a monthly basis, Contractor will provide a report detailing the prior month and year to date data collected for the NTD report. This report is due on or before the 8th of the following month.

Contractor must obtain an independent audit of said annual NTD reports at Contractor's expense. Final Audited Report shall be submitted to Agency.

Timelines for Audited Report submission shall be subject to Agency’s filing requirement.

IN WITNESS WHEREOF, the parties have caused this Contract to be executed as of the date indicated above.

VALLEY METRO RAIL, INC.: CONTRACTOR:

Firm:

BY: BY:

Signature Chief Executive Officer TITLE:

DATE:

(Print Name)

APPROVED AS TO FORM:

. General Counsel DATE: (Print Title)

contract no. lrt-08-109-fmso facilities …...facilities maintenance services sample contract july ,...

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