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To:

From:

Re:

J. Motion:

Discussion:

City of Nashua, Public Works Division

Board of Public Works Meeting Date: March 24, 2022

Daniel Hudson, P.E., City Engineer
Engineering Department

2022 Paving Program — Engineering Services

To approve the engineering services contract amendment with Hayner/Swanson, Inc.
of Nashua, NH in the amount of $227,300 for the management and construction
administration of the paving program. Department: 160 Admin/Engineering; Fund:
Bond; Activity: Paving.

14 miles of roadways are planned to be paved this year as part of the 2022 annual
paving program at a cost of approximately $4.6 million. The paving program includes
~3 miles of carryover work from 2021 contracts. Due to the scale of the project, a
professional services contract amendment with Hayner/Swanson, Inc. (HSI) is
necessary to assist City Engineering staff with the overall program management,
coordination, construction administration and observation.

The engineering services required are varied, and HSI’s responsibilities may be
adjusted by the City, based upon the specific needs and City staff workload. As in
previous years, HSI will work as an extension of City staff as a valuable team member,
due to their extensive experience with successfully completing other City projects, their
attention to cost control, and responsiveness to the City’s needs.

§ 66.36

(vi) Specifying only a ‘‘brand name”’
product instead of allowing ‘‘an equal”’
product to be offered and describing
the performance of other relevant re-
quirements of the procurement, and

(vii) Any arbitrary action in the pro-
curement process.

(2) Grantees and subgrantees will
conduct procurements in a manner
that prohibits the use of statutorily or
administratively imposed in-State or
local geographical preferences in the
evaluation of bids or proposals, except
in those cases where applicable Federal
statutes expressly mandate or encour-
age geographic preference. Nothing in
this section preempts State licensing
laws. When contracting for architec-
tural and engineering (A/E) services,
geographic location may be a selection
criteria provided its application leaves
an appropriate number of qualified
firms, given the nature and size of the
project, to compete for the contract.

(3) Grantees will have written selec-
tion procedures for procurement trans-
actions. These procedures will ensure
that all solicitations:

(i) Incorporate a clear and accurate
description of the technical require-
ments for the material, product, or
service to be procured. Such descrip-
tion shall not, in competitive procure-
ments, contain features which unduly
restrict competition. The description
may include a statement of the quali-
tative nature of the material, product
or service to be procured, and when
necessary, shall set forth those min-
imum essential characteristics and
standards to which it must conform if
it is to satisfy its intended use. De-
tailed product specifications should be
avoided if at all possible. When it is
impractical or uneconomical to make a
clear and accurate description of the
technical requirements, a ‘‘brand name
or equal” description may be used as a
means to define the performance or
other salient requirements of a pro-
curement. The specific features of the
named brand which must be met by
offerors shall be clearly stated; and

(ii) Identify all requirements which
the offerors must fulfill and all other
factors to be used in evaluating bids or
proposals.

(4) Grantees and subgrantees will en-
sure that all prequalified lists of per-

28 CFR Ch. | (7-1-10 Edition)

sons, firms, or products which are used
in acquiring goods and services are cur-
rent and include enough qualified
sources to ensure maximum open and
free competition. Also, grantees and
subgrantees will not preclude potential
bidders from qualifying during the so-
licitation period.

(d) Methods of procurement to be fol-
lowed—(1) Procurement by small purchase
procedures. Small purchase procedures
are those relatively simple and infor-
mal procurement methods for securing
services, supplies, or other property
that do not cost more than the sim-
plified acquisition threshold fixed at 41
U.S.C. 403(11) (currently set at $100,000).
If small purchase procedures are used,
price or rate quotations shall be ob-
tained from an adequate number of
qualified sources.

(2) Procurement by sealed bids (formal
advertising). Bids are publicly solicited
and a firm-fixed-price contract (lump
sum or unit price) is awarded to the re-
sponsible bidder whose bid, conforming
with all the material terms and condi-
tions of the invitation for bids, is the
lowest in price. The sealed bid method
is the preferred method for procuring
construction, if the conditions in
§ 66.36(d)(2)(i) apply.

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

(A) A complete, adequate, and real-
istic specification or purchase descrip-
tion is available;

(B) Two or more responsible bidders
are willing and able to compete effec-
tively and for the business; and

(C) The procurement lends itself to a
firm fixed price contract and the selec-
tion of the successful bidder can be
made principally on the basis of price.

(ii) If sealed bids are used, the fol-
lowing requirements apply:

(A) The invitation for bids will be
publicly advertised and bids shall be
solicited from an adequate number of
known suppliers, providing them suffi-
cient time prior to the date set for
opening the bids;

(B) The invitation for bids. which
will include any specifications and per-
tinent attachments, shall define the
items or services in order for the bidder
to properly respond;

208

Department of Justice

(C) All bids will be publicly opened at
the time and place prescribed in the in-
vitation for bids;

(D) A firm fixed-price contract award
will be made in writing to the lowest
responsive and responsible bidder.
Where specified in bidding documents,
factors such as discounts, transpor-
tation cost, and life cycle costs shall be
considered in determining which bid is
lowest. Payment discounts will only be
used to determine the low bid when
prior experience indicates that such
discounts are usually taken advantage
of; and

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

(3) Procurement by competitive pro-
posals. The technique of competitive
proposals is normally conducted with
more than one source submitting an
offer, and either a fixed-price or cost-
reimbursement type contract is award-
ed. It is generally used when conditions
are not appropriate for the use of
sealed bids. If this method is used, the
following requirements apply:

(i) Requests for proposals will be pub-
licized and identify all evaluation fac-
tors and their relative importance. Any
response to publicized requests for pro-
posals shall be honored to the max-
imum extent practical;

(ii) Proposals will be solicited from
an adequate number of qualified
sources;

(iii) Grantees and subgrantees will
have a method for conducting tech-
nical evaluations of the proposals re-
ceived and for selecting awardees;

(iv) Awards will be made to the re-
sponsible firm whose proposal is most
advantageous to the program, with
price and other factors considered; and

(v) Grantees and subgrantees may
use competitive proposal procedures
for qualifications-based procurement of
architectural/engineering (A/E) profes-
sional services whereby competitors’
qualifications are evaluated and the
most qualified competitor is selected,
subject to negotiation of fair and rea-
sonable compensation. The method,
where price is not used as a selection
factor, can only be used in procure-
ment of A/E professional services. It
cannot be used to purchase other types
of services though A/E firms are a po-

§ 66.36

tential source to perform the proposed
effort.

(4) Procurement by noncompetitive
proposals is procurement through solic-
itation of a proposal from only one
source, or after solicitation of a num-
ber of sources, competition is deter-
mined inadequate.

(i) Procurement by noncompetitive
proposals may be used only when the
award of a contract is infeasible under
small purchase procedures, sealed bids
or competitive proposals and one of the
following circumstances applies:

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

(B) The public exigency or emergency
for the requirement wil] not permit a
delay resulting from competitive solic-
itation;

(C) The awarding agency authorizes
noncompetitive proposals; or

(D) After solicitation of a number of
sources, competition is determined in-
adequate.

(ii) Cost analysis, i.e., verifying the
proposed cost data, the projections of
the data, and the evaluation of the spe-
cific elements of costs and profits, is
required.

(iii) Grantees and subgrantees may
be required to submit the proposed pro-
curement to the awarding agency for
pre-award review in accordance with
paragraph (g) of this section.

(e) Contracting with small and minority
firms, women’s business enterprise and
labor surplus area firms. (1) The grantee
and subgrantee will take all necessary
affirmative steps to assure that minor-
ity firms, women’s business enter-
prises, and labor surplus area firms are
used when possible.

(2) Affirmative steps shall include:

(i) Placing qualified small and minor-
ity businesses and women's business
enterprises on solicitation lists;

(ii) Assuring that small and minority
businesses, and women’s business en-
terprises are solicited whenever they
are potential sources;

Gii) Dividing total requirements,
when economically feasible, into small-
er tasks or quantities to permit max-
imum participation by small and mi-
nority business, and women’s business
enterprises;

(iv) Establishing delivery schedules,
where the requirement permits, which

209

§ 66.36

encourage participation by small and
minority business, and women’s busi-
ness enterprises;

(v) Using the services and assistance
of the Small Business Administration,
and the Minority Business Develop-
ment Agency of the Department of
Commerce; and

(vi) Requiring the prime contractor,
if subcontracts are to be let, to take
the affirmative steps listed in para-
graphs (e)(2) Gd) through (v) of this sec-
tion.

(f) Contract cost and price. (1) Grant-
ees and subgrantees must perform a
cost or price analysis in connection
with every procurement action includ-
ing contract modifications. The meth-
od and degree of analysis is dependent
on the facts surrounding the particular
procurement situation, but as a start-
ing point, grantees must make inde-
pendent estimates before receiving bids
or proposals. A cost analysis must be
performed when the offeror is required
to submit the elements of his esti-
mated cost, e.g., under professional,
consulting, and architectural engineer-
ing services contracts. A cost analysis
will be necessary when adequate price
competition is lacking, and for sole
source procurements, including con-
tract modifications or change orders,
unless price resonableness can be es-
tablished on the basis of a catalog or
market price of a commercial product
sold in substantial quantities to the
general public or based on prices set by
law or regulation. A price analysis will
be used in all other instances to deter-
mine the reasonableness of the pro-
posed contract price.

(2) Grantees and subgrantees will ne-
gotiate profit as a separate element of
the price for each contract in which
there is no price competition and in all
cases where cost analysis is performed.
To establish a fair and reasonable prof-
it, consideration will be given to the
complexity of the work to be per-
formed, the risk borne by the con-
tractor, the contractor’s investment,
the amount of subcontracting, the
quality of its record of past perform-
ance, and industry profit rates in the
surrounding geographical area for
similar work.

(3) Costs or prices based on estimated
costs for contracts under grants will be

28 CFR Ch. } (7-1-10 Edition)

allowable only to the extent that costs
incurred or cost estimates included in
negotiated prices are consistent with
Federal cost principles {see §66.22).
Grantees may reference their own cost
principles that comply with the appli-
cable Federal cost principles.

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

(g) Awarding agency review. (1) Grant-
ees and subgrantees must make avail-
able, upon request of the awarding
agency, technical specifications on pro-
posed procurements where the award-
ing agency believes such review is
needed to ensure that the item and/or
service specified is the one being pro-
posed for purchase. This review gen-
erally will take place prior to the time
the specification is incorporated into a
solicitation document. However, if the
grantee or subgrantee desires to have
the review accomplished after a solici-
tation has been developed, the award-
ing agency may still review the speci-
fications, with such review usually lim-
ited to the technical aspects of the pro-
posed purchase.

(2) Grantees and subgrantees must on
request make available for awarding
agency pre-award review procurement
documents, such as requests for pro-
posals or invitations for bids, inde-
pendent cost estimates, etc. when:

(1) A grantee’s or subgrantee’s pro-
curement procedures or operation fails
to comply with the procurement stand-
ards in this section; or

(ii) The procurement is expected to
exceed the simplified acquisition
threshold and is to be awarded without
competition or only one bid or offer is
received in response to a solicitation;
or

(iii) The procurement, which is ex-
pected to exceed the simplified acquisi-
tion threshold, specifies a “brand
name’’ product; or

(iv) The proposed award is more than
the simplified acquisition threshold
and is to be awarded to other than the
apparent low bidder under a sealed bid
procurement; or

(v) A proposed contract modification
changes the scope of a contract or in-
creases the contract amount by more

210

Department of Justice

than the simplified acquisition thresh-
old.

(3) A grantee or subgrantee will be
exempt from the pre-award review in
paragraph (g)(2) of this section if the
awarding agency determines that its
procurement systems comply with the
standards of this section.

(i) A grantee or subgrantee may re-
quest that its procurement system be
reviewed by the awarding agency to de-
termine whether its system meets
these standards in order for its system
to be certified. Generally, these re-
views shall occur where there is a con-
tinuous high-dollar funding, and third-
party contracts are awarded on a reg-
ular basis.

(ii) A grantee or subgrantee may self-
certify its procurement system. Such
self-certification shall not limit the
awarding agency's right to survey the
system. Under a self-certification pro-
cedure, awarding agencies may wish to
rely on written assurances from the
grantee or subgrantee that it is com-
plying with these standards. A grantee
or subgrantee will cite specific proce-
dures, regulations, standards, etc., as
being in compliance with these require-
ments and have its system available
for review.

(h) Bonding requirements. For con-
struction or facility improvement con-
tracts or subcontracts exceeding the
simplified acquisition threshold, the
awarding agency may accept the bond-
ing policy and requirements of the
grantee or subgrantee provided the
awarding agency has made a deter-
mination that the awarding agency’s
interest is adequately protected. If
such a determination has not been
made, the minimum requirements shall
be as follows:

(1) A bid guarantee from each bidder
equivalent to five percent of the bid price.
The ‘bid guarantee’ shall consist of a
firm commitment such as a bid bond,
certified check, or other negotiable in-
strument accompanying a bid as assur-
ance that the bidder will, upon accept-
ance of his bid, execute such contrac-
tual documents as may be required
within the time specified.

(2) A performance bond on the part of
the contractor for 100 percent of the con-
tract price. A ‘‘performance bond”’ is
one executed in connection with a con-

§ 66.36

tract to secure fulfillment of all the
contractor’s obligations under such
contract.

(3) A payment bond on the part of the
contractor for 100 percent of the contract
price. A *‘payment bond” is one exe-
cuted in connection with a contract to
assure payment as required by law of
all persons supplying labor and mate-
rial in the execution of the work pro-
vided for in the contract.

(i) Contract provisions. A grantee’s
and subgrantee’s contracts must con-
tain provisions in paragraph (i) of this
section. Federal agencies are permitted
to require changes, remedies, changed
conditions, access and records reten-
tion, suspension of work, and other
clauses approved by the Office of Fed-
eral Procurement Policy.

(1) Administrative, contractual, or
legal remedies in instances where con-
tractors violate or breach contract
terms, and provide for such sanctions
and penalties as may be appropriate.
(Contracts more than the simplified ac-
quisition threshold)

(2) Termination for cause and for
convenience by the grantee or sub-
grantee including the manner by which
it will be effected and the basis for set-
tlement. (All contracts in excess of
$10,000)

(3) Compliance with Executive Order
11246 of September 24, 1965, entitled
“Hgual Employment Opportunity,” as
amended by Executive Order 11375 of
October 13, 1967, and as supplemented
in Department of Labor regulations (41
CFR chapter 60). (All construction con-
tracts awarded in excess of $10,000 by
grantees and their contractors or sub-
grantees)

(4) Compliance with the Copeland
“Anti-Kickback’’ Act (18 U.S.C. 874) as
supplemented in Department of Labor
regulations (29 CFR part 3). (All con-
tracts and subgrants for construction
or repair)

(5) Compliance with the Davis-Bacon
Act (40 U.S.C. 276a to 276a-7) as supple-
mented by Department of Labor regu-
lations (29 CFR part 5). (Construction
coutracts in excess of $2000 awarded by
grantees and subgrantees when re-
quired by Federal grant program legis-
lation)

(6) Compliance with sections 103 and
107 of the Contract Work Hours and

211

§ 66.37

Safety Standards Act (40 U.S.C. 327-330)
as supplemented by Department of
Labor regulations (29 CFR part 5).
(Construction contracts awarded by
grantees and subgrantees in excess of
$2000, and in excess of $2500 for other
contracts which involve the employ-
ment of mechanics or laborers)

(7) Notice of awarding agency re-
quirements and regulations pertaining
to reporting.

(8) Notice of awarding agency re-
quirements and regulations pertaining
to patent rights with respect to any
discovery or invention which arises or
is developed in the course of or under
such contract.

(9) Awarding agency requirements
and regulations pertaining to copy-
rights and rights in data.

(10) Access by the grantee, the sub-
grantee, the Federal grantor agency,
the Comptroller General of the United
States, or any of their duly authorized
representatives to any books, docu-
ments, papers, and records of the con-
tractor which are directly pertinent to
that specific contract for the purpose
of making audit, examination, ex-
cerpts, and transcriptions.

(11) Retention of all required records
for three years after grantees or sub-
grantees make final payments and all
other pending matters are closed.

(12) Compliance with all applicable
standards, orders, or requirements
issued under section 306 of the Clean
Air Act (42 U.S.C. 1857(h)), section 508
of the Clean Water Act (33 U.S.C. 1368),
Executive Order 117388, and Environ-
mental Protection Agency regulations
(40 CFR part 15). (Contracts, sub-
contracts, and subgrants of amounts in
excess of $100,000)

(13) Mandatory standards and policies
relating to energy efficiency which are
contained in the state energy conserva-
tion plan issued in compliance with the
Energy Policy and Conservation Act
(Pub, L. 94-168, 89 Stat. 871).

[Order No. 1252-88, 53 FR 8068 and 8067, Mar.
11, 1988, as amended by Order No. 1961-95, 60
FR 19639, 19642, Apr. 19, 1995]

§66.37 Subgrants.

(a) States. States shall follow state
law and procedures when awarding and
administering subgrants (whether on a
cost reimbursement or fixed amount

28 CFR Ch. | (7-1-10 Edition)

basis) of financial assistance to local
and Indian tribal governments. States
shall:

(1) Ensure that every subgrant in-
cludes any clauses required by Federal
statute and executive orders and their
implementing regulations;

(2) Ensure that subgrantees are
aware of requirements imposed upon
them by Federal statute and regula-
tion;

(3) Ensure that a provision for com-
pliance with §66.42 is placed in every
cost reimbursement subgrant; and

(4) Conform any advances of grant
funds to subgrantees substantially to
the same standards of timing and
amount that apply to cash advances by
Federal agencies.

(b) All other grantees. All other grant-
ees shall follow the provisions of this
part which are applicable to awarding
agencies when awarding and admin-
istering subgrants (whether on a cost
reimbursement or fixed amount basis)
of financial assistance to local and In-
dian tribal governments. Grantees
shall:

(1) Ensure that every subgrant in-
cludes a provision for compliance with
this part;

(2) Ensure that every subgrant in-
cludes any clauses required by Federal
statute and executive orders and their
implementing regulations; and

(3) Ensure that subgrantees are
aware of requirements imposed upon
them by Federal statutes and regula-
tions.

(c) Exceptions. By their own terms,
certain provisions of this part do not
apply to the award and administration
of subgrants:

(1) Section 66.10;

(2) Section 66.11;

(3) The letter-of-credit procedures
specified in Treasury Regulations at 31
CFR part 205, cited in §66.21; and

(4) Section 66.50.

REPORTS, RECORDS, RETENTION, AND
ENFORCEMENT

866.40 Monitoring and reporting pro-
gram performance.

(a) Monitoring by grantees. Grantees
are responsible for managing the day-
to-day operations of grant and
subgrant supported activities. Grantees

212

Department of Justice

must monitor grant and subgrant sup-
ported activities to assure compliance
with applicable Federal requirernents
and that performance goals are being
achieved. Grantee monitoring must
cover each program, function or activ-
ity.

(b) Nonconstruction performance re-
ports. The Federal agency may, if it de-
cides that performance information
available from subsequent applications
contains sufficient information to
meet its programmatic needs, require
the grantee to submit a performance
report only upon expiration or termi-
nation of grant support. Unless waived
py the Federal agency this report will
be due on the same date as the final Fi-
nancial Status Report.

(1) Grantees shall submit annual per-
formance reports unless the awarding
agency requires quarterly or semi-an-
nual reports. However, performance re-
ports will not be required more fre-
quently than quarterly. Annual reports
shall be due 90 days after the grant
year, quarterly or semi-annual reports
shall be due 30 days after the reporting
period. The final performance report
will be due 90 days after the expiration
or termination of grant support. If a
justified request is submitted by a
grantee, the Federal agency may ex-
tend the due date for any performance
report. Additionally, requirements for
unnecessary performance reports may
be waived by the Federal agency.

(2) Performance reports will contain,
for each grant, brief information on the
following:

dj) A comparison of actual accom-
plishments to the objectives estab-
lished for the period. Where the output
of the project can be quantified, a com-
putation of the cost per unit of output
may be required if that information
will be useful.

(ii) The reasons for slippage if estab-
lished objectives were not met.

(iii) Additional pertinent information
including. when appropriate, analysis
and explanation of cost overruns or
high unit costs.

(3) Grantees will not be required to
submit more than the original and two
copies of performance reports.

(4) Grantees will adhere to the stand-
ards in this section in prescribing per-

§ 66.41

formance reporting requirements for
subgrantees.

(c) Construction performance reports.
For the most part, on-site technica] in-
spections and certified percentage-of-
completion data are relied on heavily
by Federal agencies to monitor
progress under construction grants and
subgrants. The Federal agency will re-
quire additional formal performance
reports only when considered nec-
essary, and never more frequently than
quarterly.

(ad) Significant developments. Events
may occur between the scheduled per-
formance reporting dates which have
significant impact upon the grant or
subgrant supported activity. In such
cases, the grantee must inform the
Federal agency as soon as the following
types of conditions become known:

(1) Problems, delays, or adverse con-
ditions which will materially impair
the ability to meet the objective of the
award. This disclosure must include a
statement of the action taken, or con-
templated, and any assistance needed
to resolve the situation.

(2) Favorable developments which en-
able meeting time schedules and objec-
tives sooner or at less cost than antici-
pated or producing more beneficial re-
sults than originally planned.

(e) Federal agencies may make site
visits as warranted by program needs.

(f) Waivers, extensions. (1) Federal
agencies may waive any performance
report required by this part if not need-
ed.

(2) The grantee may waive any per-
formance report from a subgrantee
when not needed. The grantee may ex-
tend the due date for any performance
report from a subgrantee if the grantee
will still be able to meet its perform-
ance reporting obligations to the Fed-
eral agency.

$66.41 Financial reporting.

(a) General. (1) Except as provided in
paragraphs (a) (2) and (5) of this sec-
tion, grantees will use only the forms
specified in paragraphs (a) through (e)
of this section, and such supple-
mentary or other forms as may from
time to time be authorized by OMB,
for:

(i) Submitting financial reports to
Federal agencies, or

213

§ 66.41

(ii) Requesting advances or reim-
bursements when letters of credit are
not used.

(2) Grantees need not apply the forms
prescribed in this section in dealing
with their subgrantees. However,
grantees shall not impose more burden-
some requirements on subgrantees.

(3) Grantees shall follow all applica-
ble standard and supplemental Federal
agency instructions approved by OMB
to the extend required under the Paper-
work Reduction Act of 1980 for use in
connection with forms specified in
paragraphs (b) through (e) of this sec-
tion. Federal agencies may issue sub-
stantive supplementary instructions
only with the approval of OMB. Federal
agencies may shade out or instruct the
grantee to disregard any line item that
the Federal agency finds unnecessary
for its decisionmaking purposes.

(4) Grantees will not be required to
submit more than the original and two
copies of forms required under this
part.

(5) Federal agencies may provide
computer outputs to grantees to expe-
dite or contribute to the accuracy of
reporting. Federal agencies may accept
the required information from grantees
in machine usable format or computer
printouts instead of prescribed forms.

(6) Federal agencies may waive any
report required by this section if not
needed.

(7) Federal agencies may extend the
due date of any financial report upon
receiving. a justified request from a
grantee.

(b) Financial Status Report—(1) Form.
Grantees will use Standard Form 269 or
969A, Financial Status Report, to re-
port the status of funds for all non-
construction grants and for construc-
tion grants when required in accord-
ance with §66.41(e)(2)Gii).

(2) Accounting basis, Each grantee will
report program outlays and program
income on a cash or accrual basis as
prescribed by the awarding agency. if
the Federal agency requires accrual in-
formation and the grantee’s accounting
records are not normally kept on the
accrual basis, the grantee shall not be
required to convert its accounting sys-
tem but shall develop such accrual in-
formation through and analysis of the
documentation on hand.

28 CFR Ch. | (7-1-10 Edition)

(3) Frequency. The Federal agency
may prescribe the frequency of the re-
port for each project or program. How-
ever, the report will not be required
more frequently than quarterly. If the
Federal agency does not specify the
frequency of the report, it will be sub-
mitted annually. A final report will be
required upon expiration or termi-
nation of grant support.

(4) Due date. When reports are re-
quired on a quarterly or semiannual
hasis, they will be due 30 days after the
reporting period. When required on an
annual basis, they will be due 90 days
after the grant year. Final reports will
be due 90 days after the expiration or
termination of grant support.

(c) Federal Cash Transactions Report—
(1) Form. (i) For grants paid by letter or
credit, Treasury check advances or
electronic transfer of funds, the grant-
ee will submit the Standard Form 272,
Federal Cash Transactions Report, and
when necessary, its continuation sheet,
Standard Form 272a, unless the terms
of the award exempt the grantee from
this requirement.

(ii) These reports will be used by the
Federal agency to monitor cash ad-
vanced to grantees and to obtain dis-
bursement or outlay information for
each grant from grantees. The format
of the report may be adapted as appro-
priate when reporting is to be accom-
plished with the assistance of auto-
matic data processing equipment pro-
vided that the information to be sub-
mitted is not changed in substance.

(2) Forecasts of Federal cash require-
ments. Forecasts of Federal cash re-
quirements may be required in the
“Remarks” section of the report.

(3) Cash in hands of subgrantees. When
considered necessary and feasible by
the Federal agency, grantees may be
required to report the amount of cash
advances in excess of three days’ needs
in the hands of their subgrantees or
contractors and to provide short nar-
rative explanations of actions taken by
the grantee to reduce the excess bal-
ances.

(4) Frequency and due date. Grantees
must submit the report no later than 15
working days following the end of each
quarter. However, where an advance ei-
ther by letter of credit or electronic
transfer of funds is authorized at an

214

Department of Justice

annualized rate of one million dollars
or more, the Federal agency may re-
quire the report to be submitted within
15 working days following the end of
each month.

(d) Request for advance or reimburse-
ment—(1) Advance payments. Requests
for Treasury check advance payments
will be submitted on Standard Form
270, Request for Advance or Reimburse-
ment. (This form will not be used for
drawdowns under a letter of credit,
electronic funds transfer or when
Treasury check advance payments are
made to the grantee automatically on
a predetermined basis.)

(2) Reimbursements. Requests for reim-
bursement under ‘nonconstruction
grants will also be submitted on Stand-
ard Form 270. (For reimbursement re-
quests under construction grants, see
paragraph (e)(1) of this section.)

(3) The frequency for submitting pay-
ment requests is treated in § 66.41(b)(3).

(e) Outlay report and request for reim-
bursement for construction programs—(1)
Grants that support construction activi-
ties paid by reimbursement method. (1)
Requests for reimbursement under con-
struction grants will be submitted on
Standard Form 271, Outlay Report and
Request for Reimbursement for Con-
struction Programs. Federal agencies
may, however, prescribe the Request
for Advance or Reimbursement form,
specified in §66.41(d), instead of this
form.

(ii) The frequency for submitting re-
imbursement requests is treated in
§66.41(b)(3).

(2) Grants that support construction ac-
tivities paid by letter of credit, electronic
funds transfer or Treasury check ad-
vance. (i) When a construction grant is
paid by letter of credit, electronic
funds transfer or Treasury check ad-
vances, the grantee will report its out-
lays to the Federal agency using
Standard Form 271, Outlay Report and
Request for Reimbursement for Con-
struction Programs. The Federal agen-
cy will provide any necessary special
instruction. However, frequency and
due date shall be governed by §66.41(b)
(3) and (4).

(ii) When a construction grant is paid
by Treasury check advances based on
periodic requests from the grantee, the

§ 66.42

advances will be requested on the form
specified in §66.41(d).

(iii) The Federal agency may sub-
stitute the Financial Status Report
specified in §66.41(b) for the Outlay Re-
port and Request for Reimbursement
for Construction Programs.

(8) Accounting basis. The accounting
basis for the Outlay Report and Re-
quest for Reimbursement for Construc-
tion Programs shall be governed by
§ 66.41(b)(2).

866.42 Retention and access require-
ments for records.

(a) Applicability. (1) This section ap-
plies to all financial and programmatic
records, supporting documents, statis-
tical records, and other records of
grantees or subgrantees which are:

(i) Required to be maintained by the
terms of this part, program regulations
or the grant agreement, or

(ii) Otherwise reasonably considered
as pertinent to program regulations or
the grant agreement.

(2) This section does not apply to
records maintained by contractors or
subcontractors. For a requirement to
place a provision concerning records in
certain kinds of contracts, see
§ 66.36(1)(10).

(b) Length of retention period. (1) Ex-
cept as otherwise provided, records
must be retained for three years from
the starting date specified in paragraph
(c) of this section.

(2) If any litigation, claim, negotia-
tion, audit or other action involving
the records has been started before the
expiration of the 3-year period, the
records must be retained until comple-
tion of the action and resolution of all
issues which arise from it, or until the
end of the regular 3-year period, which-
ever is later.

(3) To avoid duplicate recordkeeping,
awarding agencies may make special
arrangements with grantees and sub-
grantees to retain any records which
are continuously needed for joint use.
The awarding agency will request
transfer of records to its custody when
it determines that the records possess
long-term retention value. When the
records are transferred to or main-
tained by the Federal agency, the 3-
year retention requirement is not ap-
plicable to the grantee or subgrantee.

215

§ 66.43

(c) Starting date of retention period—{1)
General. When grant support is contin-
ued or renewed at annual or other in-
tervals, the retention period for the
records of each funding period starts on
the day the grantee or subgrantee sub-
mits to the awarding agency its single
or last expenditure report for that pe-
riod. However, if grant support is con-
tinued or renewed quarterly, the reten-
tion period for each year’s records
starts on the day the grantee submits
its expenditure report for the last quar-
ter of the Federal fiscal year. In all
other cases, the retention period starts
on the day the grantee submits its
final expenditure report. If an expendi-
ture report has been walved, the reten-
tion period starts on the day the report
would have been due.

(2) Real property and equipment
records. The retention period for real
property and equipment records starts
from the date of the disposition or re-
placement or transfer at the direction
of the awarding agency.

- (8) Records for income transactions
after grant or subgrant support. In some
cases grantees must report income
after the period of grant support.
Where there is such a requirement, the
retention period for the records per-
taining to the earning of the income
starts from the end of the grantee’s fis~
cal year in which the income is earned.

(4) Indirect cost rate proposals, cost al-
locations plans, etc. This paragraph ap-
plies to the following types of docu-
ments, and their supporting records:
indirect cost rate computations or pro-
posals, cost allocation plans, and any
similar accounting computations of
the rate at which a particular group of
costs is chargeable (such as computer
usage chargeback rates or composite
fringe benefit rates).

(i) If submitted for negotiation. If the
proposal, plan, or other computation is
required to be submitted to the Federal
Government (or to the grantee) to form
the basis for negotiation of the rate,
then the 3-year retention period for its
supporting records starts from the date
of such submission.

(ii) If not submitted for negotiation. If
the proposal, plan, or other computa-
tion is not required to be submitted to
the Federal Government (or to the
grantee) for negotiation purposes, then

28 CFR Ch, | (7-1-10 Edition)

the 3-year retention period for the pro-
posal plan, or computation and its sup-
porting records starts from end of the
fiscal year (or other accounting period)
covered by the proposal, plan, or other
computation.

(d) Substitution of microfilm. Copies
made by microfilming, photocopying,
or similar methods may be substituted
for the original records.

(e) Access to records—(1) Records of
grantees and subgrantees. The awarding
agency and the Comptroller General of
the United States, or any of their au-
thorized representatives, shall have the
right of access to any pertinent books,
documents, papers, or other records of
grantees and subgrantees which are
pertinent to the grant, in order to
make audits, examinations, excerpts,
and transcripts.

(2) Expiration of right of access. The
rights of access in this section must
not be limited to the required reten-
tion period but shall last as long as the
records are retained.

(f) Restrictions on public access. The
Federal Freedom of Information Act (5
U.S.C. 552) does not apply to records
Unless required by Federal, State, or
local law, grantees and subgrantees are
not required to permit public access to
their records.

§66.43 Enforcement.

(a) Remedies for noncompliance. If a
grantee or subgrantee materially fails
to comply with any term of an award,
whether stated in a Federal statute or
regulation, an assurance, in a State
plan or application, a notice of award.
or elsewhere, the awarding agency may
take one or more of the following ac-
tions, as appropriate in the cir-
cumstances:

(1) Temporarily withhold cash pay-
ments pending correction of the defi-
ciency by the grantee or subgrantee or
more severe enforcement action by the
awarding agency,

(2) Disallow (that is, deny both use of
funds and matching credit for) all or
part of the cost of the activity or ac-
tion not in compliance,

(3) Wholly or partly suspend or ter-
minate the current award for the
grantee's or subgrantee’s program,

(4) Withhold further awards for the
program, or

216