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2005 Nebraska CDBG Construction Project Management and Labor Regulations

This project management timeline outlines the tasks and timelines for the Nebraska CDBG construction project, including selection of professional services, contract signing, compliance programs, and more.

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2005 Nebraska CDBG Construction Project Management and Labor Regulations

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  1. 2005 Nebraska CDBG Construction Project Management and Labor Regulations

  2. Task/Timeline after Project is awarded • Selection of professional service – (10-1 to 10-3) • Signing contract for professional service – (10-2 to 10-3) • Develop compliance/enforcement programs – (10-4 to 10-5) • Secure Wage Determination – (10-6 to 10-7 - online) • Prepare construction bid package – (10-6 to 10-9) • Advertise for construction bids – (10-7 to 10-8)

  3. Task/Timeline after Project is awarded (continued) • Construction bid opening – (10-8) • Verification of construction contractor(s) – (10-9 - online) • Contract Award – (10-9 and 10-10) • Notice of Contract Award to DED – (10-9) • Preconstruction or similar meeting – 10-10 (attachment 10 as a guide) • Request additional Wage Classification after contract awarded – 10-10 (attachment 11 and SF-1444 as guides)

  4. Task/Timeline after Project is awarded (continued) • Notice to proceed to construction contractor – (10-10) • Payroll submittal to DED (copies of first 2 payrolls from each contractor) – (10-11) • On-site visits by grantee – (10-11) • Management of construction – (10-12 to 10-14) • Final wage compliance report – (LSE9)

  5. Applicable to ED projects • Not Applicable • ¨ If CDBG funds are used to fund non-construction “soft costs” (land and building acquisition, equipment, engineering services, etc.) • ¨ For CDBG funded demolition with no construction on-site contemplated

  6. Applicable to ED projects • CDBG can finance activities other than “construction work” which do not trigger Davis-Bacon requirements; e.g., real property acquisition, purchase of equipment, architectural and engineering fees, other services (legal, accounting, construction management), and other non-construction items (furniture, business licenses, real estate taxes, tenant allowances for such items). – (States Guide to Davis-Bacon)

  7. Applicable to ED projects (Continued) • Applicable • If CDBG funds are used to fund “in whole or in part” construction contracts of over $2,000 • If CDBG funds are used to fund demolition activities to be followed by on-site construction • If CDBG funds are used for the installation of equipment and it is considered more than an incidental amount of the overall project cost

  8. Applicable to ED projects (Continued) • EQUIPMENT PURCHASED USING CDBG FUNDS • Davis-Bacon prevailing wages are required only if the installation of the equipment is financed by CDBG funds (either as part of the purchase price of equipment or as a separate cost) and the installation involves “more than an incidental amount” of the overall project cost.

  9. Applicable to ED projects (Continued) • Two-Stage Test to Determine if Installation is Incidental to Overall Project Cost • Stage One: If installation cost is 20% or less of overall project cost Davis-Bacon wage rates do not apply. • Stage Two: If installation cost is greater than 20% of overall project cost Davis-Bacon wage rates may apply. Other factors are considered such as the high absolute cost of installation, the need for structural modification (such as lowering or raising ceiling, reinforcing floor, etc.) or the need for upgraded electrical, plumbing, or gas lines to accommodate the equipment installation.

  10. HOME and Davis-BaconLR-96-02 - http://www.hud.gov/offices/olr/olr_9602.cfm • "Any contract for the construction of affordable housing with 12 or more units assisted with funds made available under this subtitle shall contain a provision requiring that not less than the wages prevailing in the locality, as predetermined by the Secretary of Labor pursuant to the Davis-Bacon Act..., shall be paid to all laborers and mechanics employed in the development of affordable housing involved,....“

  11. HOME and Davis-Bacon • HUD regulations (24 CFR 92.354) paraphrase the statutory provision and clarify that the contract for construction must contain these wage provisions if HOME funds are used for any project costs, including construction or nonconstruction costs, for housing with 12 or more HOME-assisted units.

  12. HOME and Davis-Bacon (continued) • …a construction contract that includes a total of 12 or more HOME-assisted units is covered by Davis-Bacon requirements even if the contract covers more than one HOME "project" and prohibits arranging multiple construction contracts within a single project for the purpose of avoiding Davis-Bacon coverage. Once triggered, the wage provisions apply to the construction of the entire project - HOME-assisted and non-assisted portions, alike.

  13. HOME and Davis-Bacon (continued) • The NAHA and program regulations also provide for the exclusion of certain sweat equity labor from Davis-Bacon coverage. Members of an eligible family who provide labor in exchange for acquisition of a property for homeownership or toward rental payments are not subject to Davis-Bacon wage requirements.

  14. HOME and Davis-Bacon (continued) • CDBG apply to construction work financed in whole or in part with the assistance received through CDBG and cover residential property only if the property contains not less than 8 units. For HOME, we are directed to "construction contracts" (not construction work or properties) where the standard is whether 12 or more of "units" covered by the contract are "assisted" (not whether construction work is directly financed).

  15. HOME and Davis-Bacon (continued) • 1) A HOME project can not be divided into multiple contracts to avoid Davis-Bacon coverage. There may be other, legitimate reasons that a single project would be constructed with separate contracts that would each contain 11 or less HOME units and the contracts would not be covered. But it is not permissible to arrange multiple contracts solely to circumvent labor standards requirements.

  16. HOME and Davis-Bacon (continued) • 2) A construction contract with 12 or more HOME-assisted units is covered even if the contract involves more than one HOME project. For example, if, for whatever reason, four projects each containing 4 HOME-assisted units are "pooled" into one construction contract, the contract would be covered.

  17. HOME and Davis-Bacon (continued) • PJs may choose to consider group homes as a single unit for HOME assistance purposes or may classify them as single room occupancy units. In the latter case, if the number of HOME-assisted SRO dwelling units covered by a contract for construction equals 12 or more, Davis-Bacon labor standards are applicable.

  18. HOME and Davis-Bacon (continued) • Homeownership projects • Construction work for projects in which HOME funds are used only to assist homebuyers to acquire single family housing is not covered UNLESS there is an agreement with the owner or developer of the housing in advance of the construction work that HOME funds will be used to assist homebuyers to buy the housing and the construction contract covers 12 or more HOME-assisted units.

  19. Chapter 10 – Public Improvements

  20. Task #1: Select and Architect/Engineer or Consultant and Negotiate a Contract • Procurement Procedures (10-1 to 10-3) • Define nature and extent of services required • Does not apply to officials of the Grantee who are acting in their official capacity. • They must be appointed regularly annually before application of the Project • Need minutes available to verify they have been appointed regularly annually • There should be documentation before CDBG funds were considered. Generally 2-3 years prior.

  21. Task #1: Select and Architect/Engineer or Consultant and Negotiate a Contract • Procurement Procedures (10-1 to 10-2) • Grantee must ensure “maximum open and free competition.” • RFQ is generally used for Architects and Engineers • RFP is generally use for Consultants. • Review should be thorough, uniform, and well documented

  22. Task #1: Select and Architect/Engineer or Consultant and Negotiate a Contract • Contract Provisions • Effective date of contract • Names and addresses of municipality and firm • Names who will act as representatives • Authority of the Grantee under contract • Conditions Contract may be terminated • Clause prohibiting transfer of any interest in the contract by the consultant • Maintenance of records and furnish reports

  23. Task #1: Select and Architect/Engineer or Consultant and Negotiate a Contract • Contract Provisions (continued) • Scope of Services • Detailed Description • Time of Performance • Specification of materials • Method of Compensation • Federal Provisions • E.O. 11246, Title VI clause from the Civil Rights of 1964, Access to Records, Conflict of Interest, Section 3, Section 109, Age Discrimination Act of 1975, Section 504 of the Rehabilitation Act of 1973

  24. Task #1: Select and Architect/Engineer or Consultant and Negotiate a Contract • Contract File to Include • Description of method used to select consultants; • Qualification statements, RFP and proposal(s) received; • Negotiation methods; • Cost and pricing data; • Contract for Services; • Records of partial payments and supporting documentation (in financial management files); and • Contract amendments, if any, and rationale for amendment.

  25. Section 110, Chapter 69, Title 42, Housing and Community Development Act of 1974 (42 U.S.C. 5310) This section shall apply to the rehabilitation of residential property only if such property contains not less than 8 units.” Davis-Bacon Act (40 U.S.C. 276A - 276A-5). The Davis-Bacon Act (DBA) provides that contracts in excess of $2,000 to which the United States is party for the construction. Task #2: Review Labor Laws and Establish Files for Construction Contracts

  26. Contract Work Hours and Safety Standards Act (40 U.S.C. 327 - 333). This Act (CWHSSA) applies to both direct Federal contracts. CWHSSA provides that work in excess of 40 hours per week shall be compensated for at rates not less than one and one-half times the basic rate of pay. Task #2: Review Labor Laws and Establish Files for Construction Contracts

  27. Task #2: Review Labor Laws and Establish Files for Construction Contracts • Copeland Act (Anti-Kickback Act) (40 U.S.C. 276c). The Copeland Act makes it a criminal offense for any person to induce, to give up any part of the compensation to which he is entitled under his contract of employment. • Fair Labor Standards Act of 1938, as Amended, (29 U.S.C. 102, et. seq.). This Act provides for minimum wages for construction workers, overtime pay (forty-hour week), recordkeeping and child labor standards.

  28. Task #2: Review Labor Laws and Establish Files for Construction Contracts • Project Compliance (Require Davis-Bacon Examples) • If CDBG funds are used to fund “in whole or in part” construction contracts of over $2,000, • Demolition activities to be followed by on-site construction, • Installation of equipment and it is considered more than an incidental amount of the overall project cost

  29. Task #2: Review Labor Laws and Establish Files for Construction Contracts • Project Compliance (Does not require Davis-Bacon Examples) • If CDBG funds are used to fund non-construction “soft costs” (land and building acquisition, equipment, engineering services, etc.) • For CDBG funded demolition with no construction on-site contemplated

  30. Task #2: Review Labor Laws and Establish Files for Construction Contracts • Major Steps/Filing System • Preliminary Design and Cost Estimates. • Final Design and Cost Estimates. • Evidence that all necessary land or easement acquisition has been completed prior to advertising for bids. • Wage Determination(s) for project. • Construction bid package.

  31. Task #2: Review Labor Laws and Establish Files for Construction Contracts • Major Steps/Filing System • Approval of Bid Documents by authorities having jurisdiction over the project. • Proof of Publication advertising bids. This file may also include any letters utilized to specifically solicit for minority/women contractor participation. • Bid opening minutes, bid tabulations.

  32. Task #2: Review Labor Laws and Establish Files for Construction Contracts • Major Steps/Filing System • Wage Determination verification TEN DAYS PRIOR to bid opening. • Verification of contractor eligibility. • Written recommendation for award of contract. • Executed Construction contract(s). • Pre-construction conference minutes or evidence of meeting with contractor. • Rationale for Contract Amendments

  33. Task #2: Review Labor Laws and Establish Files for Construction Contracts • Major Steps/Filing System • Notification to the Department of Contract Award. • Contractor/subcontractor weekly payrolls and evidence of review,(a copy of the first 2 reviewed payrolls must be submitted to the Department with any corrections). • Employee interview forms and evidence of review. • Verification of job site posting. • Other related correspondence.

  34. Task #3: Changes from 2004 to 2005 • Remove reference to attachment 12 – Federal Labor Clauses – reason is because this information is in the HUD-4010

  35. Task #3: Bid Package Procedures, Provisions, and Contract Provisions • Acquisition Requirements • The Grantee must have obtained all lands, rights-of-way and easements necessary for carrying out the project prior to bid advertising (see Property Acquisition Chapter).

  36. Task #3: Bid Package Procedures, Provisions, and Contract Provisions • Bid Package Procedures • The architect or engineer will normally prepare the technical bid specifications. These specifications must provide a clear and accurate description of the technical requirements for materials, products and/or services to be provided and under which the work is to be performed. The plans and specifications must be stamped by an architect or engineer registered by the state and in accordance with Nebraska statutes.

  37. Task #3: Bid Package Procedures, Provisions, and Contract Provisions • Securing a Wage Determination • Two Methods for Area Wage Determination – By the Grantee/From the Department • By the Grantee • Checked minimum of 10 days before Bid Opening • Davis-Bacon Wage Determination Web Sitehttp://www.gpo.gov/davisbacon/ • All Agency Memorandum No. 130http://www.hud.gov/offices/olr/memo130.cfm • http://www.hud.gov/offices/olr/memo131.cfmMemorandum No. 130 as a guide

  38. Task #3: Bid Package Procedures, Provisions, and Contract Provisions • From the Department • LSE 1 submitted to the Department (minimum of 10 days prior to Bid Opening) • LSE 2 returned to the Grantee with Package • ALL PROJECT SPECIFIC DETERMINATIONS MUST BE MADE THROUGH THE DEPARTMENT • Need Area Determination • Most Waterwell Projects require this • SF-308 • Good for 180 Days

  39. Project Compliance • If Send LSE 1 to the Department items you will receive a “Project Compliance” packet • To Be in Wage Determination • General Wage Determination • Wage Determination Transmittal (LSE 2) • Attachments • 1 – Bonding and Insurance Requirements Clause • 3 – Civil Rights and Equal Opportunity Provisions • Title VI of the Civil Rights Act of 1964 Clause

  40. Project Compliance (continued) • 3 – Civil Rights and Equal Opportunity Provisions • Section 109 of the HCDA Act of 1974 Clause • Age Discrimination Act of 1975 Clause • Section 504 of the Rehabilitation Act of 1973 Clause • Section 3 of the HUD Act of 1968 Clause • 3a – Certification of Bidder Regarding Section 3 • Going to have a plan in place concerning Section 3 • 3b – Section 3 Plan • This is an example of a Section 3 Plan

  41. Project Compliance (continued) • 4 – Special Equal Opportunity Provisions • If Contract is under $10,000 then Part A applies • If Contract is over $10,000 then Part B applies • 5 – Access to and Maintenance of Records • Change from 3 years to 4 years • Conflict of interest Clause • 6 – Clear air and water acts clauses • HUD-4010 – Labor Standards Provisions

  42. Project Compliance (continued) • Included for your information/submittal to DED/to be posted at Job Site • Contractor’s Guide to Davis-Bacon Wage Requirements and Certified Payroll Reports (we will cover this more in depth later) • Payroll Form WH-347 / Compliance WH-348 (we will cover this more in depth later) • Employee interview form, HUD-11

  43. Project Compliance (continued) • Three Posters • Notice to All Employees • Equal Employment Opportunity is the law • You have a Right to a Safe and Healthful Workplace • Wage Determination(s) must be posted at job site as well • Notice of Contract Award (LSE7) – This MUST be submitted to me within 10 days of the Contract Award This information can be found on our website at http://crd.neded.org/publications/cdbg_forms.htm in the Construction Compliance Packets

  44. Task #3: Bid Package Procedures, Provisions, and Contract Provisions • Requirements for Bid Package • Flood Insurance, if applicable. • Bonding and Insurance. (Attachment 1) • Title VI of the Civil Rights Act of 1964. (Attachment 3) • Section 109 of Title I of the HCDA of 1974, as Amended. (Attachment 3) • Age Discrimination Act of 1975, as Amended. (Attachment 3) • Section 504 of the Rehabilitation Act of 1973, as Amended. (Attachment 3) • Section 3 of the HUD Act of 1968, as amended. (Attachment 3)

  45. Task #3: Bid Package Procedures, Provisions, and Contract Provisions • Requirements for Bid Package (Continued) • Section 3 of the HUD Act of 1968, as amended. (Attachment 3) • Federal Executive Order 11246. (Attachment 4) • Conflict of Interest Clause. (Attachment 5) • Access to and Maintenance of Records Clause. (Attachment 5) • Clean Air/Water Clause. (Attachment 6) • Applicable Wage Determination(s). • Federal Labor Standards Provisions (HUD-4010)

  46. Task #3: Bid Package Procedures, Provisions, and Contract Provisions • Attorney Review • Bids Advertised • Public advertising • Verification of Bid Opening Date • 10 Days Prior must verify Wage Determination • Bid Amendments • Bid Opening and Evaluation

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