**U. S. Department of Agriculture**

**Rural Utilities Service**

**1400 Independence Avenue SW**

**STOP 1570**

**Washington, DC 20250**

**PROCEDURE NOTICE**

**EFFECTIVE DATE: July 30, 1997 NOTICE NO: WW-3**

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  **NOTICE**

  **RUS Bulletins 1780-13, 1780-14, 1780-15, 1780-16 and 1780-16 were
  revised to correct errors brought to our attention by State staffs. The
  revised instructions and bulletins will only be available from the
  water and waste home page which can be accessed at
  \"http: // www.usda.gov/rus/water/\"**
  -----------------------------------------------------------------------

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| **RUS BULLETINS**                 |                                  |
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| RUS Bulletin 1780-13              | Reformatted various signature    |
|                                   | blocks, added the word           |
| Replace whole document            | "PRINCIPAL" in third line,       |
|                                   | paragraph 3, page 2, Attachment  |
|                                   | 6. Deleted "1" in paragraph 1.26 |
|                                   | Attachment 9, page 3. Corrected  |
|                                   | word in paragraph 25.1 from      |
|                                   | "poorly" to "properly,"          |
|                                   | Attachment 9, page 19.           |
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| RUS Bulletin 1780-14              | In paragraph 3.1 added word      |
|                                   | "estimating" between "when" and  |
| Replace pages 2, 3 and 5          | "periodic." Paragraph 4.2        |
|                                   | changed "baa" to "has."          |
|                                   | Paragraph 4.2 added the word     |
|                                   | "other" between "financial or"   |
|                                   | and "interest." Paragraph 7.2    |
|                                   | changed word "has" to "as."      |
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| RUS Bulletin 1780-15              | Reformatted the various          |
|                                   | signature blocks.                |
| Replace pages 3,5, and 8          |                                  |
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| RUS Bulletin 1780-16              | Reformatted to align blanks.     |
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| Replace whole document            |                                  |
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+-----------------------------------+----------------------------------+
| RUS Bulletin 1780-17              | Reformatted to align blanks.     |
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| Replace whole document            |                                  |
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RUS Bulletin 1780-14

Page 2

2\. Contract Change Orders.

2.1 All changes affecting the project\'s construction cost or
modifications of the terms or conditions of the contract must be
authorized by means of a written contract change order which is mutually
agreed to by the OWNER and CONTRACTOR and is approved by RUS. The
contract change order will include extra work, work for which quantities
have been altered from those shown in the bidding schedule, as well as
decreases or increases in the quantities of installed units which are
different than those shown in the bidding schedule because of final
measurements. All changes must be recorded on a contract change order
before they can be included in a partial payment estimate.

2.2 FORM RD 1924‑7, \"Contract Change Order\" or similar form approved
by RUS shall be used to record CONTRACT changes.

2.3 When the CONTRACT sum is, in whole or in part, based on unit prices,
the OWNER reserves the right to increase or decrease a unit price
quantity as may be deemed reasonable or necessary in order to complete
the work contemplated by this CONTRACT.

3\. Partial Payment Estimates.

3.1 FORM RD 1924‑18, \"Partial Payment Estimate,\" or similar form
approved by RUS shall be used when estimating periodic payments due the
CONTRACTOR.

3.2 The OWNER may after consultation with the ARCHITECT/ENGINEER
withhold or, on account of subsequently discovered evidence, nullify the
whole or part of any approved partial payment estimate to such extent as
may be necessary to protect the OWNER from loss on account of:

3.2.1 Defective work not remedied.

3.2.2 Claims filed.

3.2.3 Failure of CONTRACTOR to make payments properly to subcontractors
or suppliers.

3.2.4 A reasonable doubt that the WORK can be completed for the balance
then unpaid.

3.2.5 Damage to another CONTRACTOR.

RUS Bulletin 1780-14

Page 3

3.2.6 Performance of WORK in violation of the terms of the CONTRACT
DOCUMENTS.

3.3 Where WORK on unit price items is substantially complete but lacks
testing, clean‑up and/or corrections, amounts shall be deducted from
unit prices in partial payment estimates to amply cover such testing,
clean‑up and/or corrections.

3.4 When the items in 3.2 and 3.3 are cured, payment shall be made for
amounts withheld because of them.

3.5 Payments will not be made that would deplete the retainage nor place
in escrow any funds that are required for retainage nor invest the
retainage for the benefit of the CONTRACTOR.

4\. Conflict of Interest.

4.1. Unacceptable bidders. An ENGINEER (individual or firm including
persons they employ) who has prepared plans and specifications will not
be considered an acceptable bidder. Any firm or corporation in which
such ENGINEER (including persons they employ) is an officer, employee,
or holds or controls a substantial interest will not be considered an
acceptable bidder. Contracts or purchases by the CONTRACTOR shall not be
awarded or made to a supplier or manufacturer if the ENGINEER (firm or
individual) who prepared the plans and specifications has a corporate or
financial affiliation with the supplier or manufacturer. Bids will not
be awarded to firms or corporations which are owned or controlled wholly
or in part by a member of the governing body of the OWNER or to an
individual who is such a member.

4.2. The OWNER\'S officers, employees, or agents shall not engage in the
award or administration of this CONTRACT if a conflict of interest, real
or apparent, would be involved. Such a conflict would arise when: (a)
the employee, officer or agent; (b) any member of their immediate
family; (c) their partner or (d) an organization which employs, or is
about to employ, any of the above has financial or other interest in the
CONTRACTOR. The OWNER\'S officers, employees, or agents shall neither
solicit nor accept gratuities, favors or anything of monetary value from
the CONTRACTOR or subcontractor.

5\. Protection of Lives and Property

5.1 In order to protect the lives and health of its employees under the
CONTRACT, the CONTRACTOR shall comply with all pertinent provisions of
the Occupational Safety and Health Administration (OSHA) and any State
Safety and Health agency requirements.

RUS Bulletin 1780-14

Page 5

7.2 In the event this CONTRACT is terminated as provided in paragraph
7.1 the OWNER may pursue the same remedies against the CONTRACTOR as it
could pursue in the event of a breach of the CONTRACT by the CONTRACTOR.
As a penalty, in addition to any other damages to which it may be
entitled by law, the OWNER may pursue exemplary damages in an amount (as
determined by the OWNER) which shall be not less than three nor more
than ten times the costs the CONTRACTOR incurs in providing any such
gratuities to any such officer or employee.

8\. Audit and Access to Records. For all negotiated contracts (except
those of \$10,000 or less), the RUS, the Comptroller General, the OWNER
or any of their duly authorized representatives, shall have access to
any books, documents, papers, and records of the CONTRACTOR, which are
pertinent to the CONTRACT, for the purpose of making audits,
examinations, excerpts and transcriptions. The CONTRACTOR shall maintain
all required records for three years after final payment is made and all
other pending matters are closed.

9\. Small, Minority and Women\'s Businesses. If the CONTRACTOR intends
to let any subcontracts for a portion of the work, the CONTRACTOR shall
take affirmative steps to assure that small, minority and women\'s
businesses are used when possible as sources of supplies, equipment,
construction, and services.

10\. Anti‑Kickback. The CONTRACTOR shall comply with the Copeland
Anti‑Kickback Act (18 USC 874) as supplemented in Department of Labor
regulations (29 CFR, Part 3). This act provides that each CONTRACTOR
shall be prohibited from inducing, by any means, any person employed in
the construction, completion, or repair of public facilities, to give up
any part of the compensation to which they are otherwise entitled. The
OWNER shall report all suspected or reported violations to RUS.

RUS Bulletin 1780-15

Page 3

7\. The undersigned BIDDER understands that this contract must be
concurred in by the Rural Utilities Service.

8\. The BIDDER will submit a construction schedule and execute the
contract within 10 days after notification of contract award.

9\. It is understood that time is of the essence in this contract and
the BIDDER agrees to commence within 10 days after the Notice to Proceed
and complete work within \_\_\_ calendar days.

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ BIDDER\'S
License No. (if applicable) BIDDER

Seal (if a corporation)

By\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Title

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

(Business Address)

\*Insert: \"a corporation incorporated in the State of
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_,\" \"a partnership\"
or an individual, as applicable.

RUS Bulletin 1780-15

Page 5

ITEM III

NOTICE OF AWARD

Description of work: Construction
of\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
for the\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

To:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

The Owner has considered the Proposal submitted by you for the above
described work in response to its Notice and Instructions to Bidders
dated \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_,\_\_\_\_\_.

It is to the best interest of said Owner to accept your Proposal in the
amount
of\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

(\$\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_); you are hereby
notified that your

Proposal has been accepted for
items\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

You are required by the Notice and Instruction to Bidders to execute the
contract within ten days from the date of the delivery of this Notice to
you.

Dated this \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ day of
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_, \_\_\_\_\_\_\_

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Owner

ACCEPTANCE OF NOTICE By\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Receipt of the above Notice of
Title\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Award is hereby acknowledged this

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ day

of \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_, \_\_\_\_\_\_ .

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

By \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Title \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

RUS Bulletin 1780-15

Page 8

IN WITNESS WHEREOF, the parties hereto have executed, or caused to be
executed by their duly authorized officials, this Contract in duplicate,
on the date first above written.

OWNER:

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

By\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

(SEAL)
Name\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Title\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

ATTEST:

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Name \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Title\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

CONTRACTOR:

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

By\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Approved as lender or insurer of
Name\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

fund to defray the costs of this

contract, and without liability
Title\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

for any payments thereunder, the

Rural Utilities Service hereby Employer Identification

concurs in the award of this
Number\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

contract to

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.

U. S. Department of Agriculture

Rural Utilities Service

By \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
Title\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

This contract shall not be effective unless and until approved by the
State Program Official of the Rural Utilities Service, U. S. Department
of Agriculture, or a delegated representative.