CHAPTER 6. OTHER PROGRAM REQUIREMENTS

6-1. CIVIL RIGHTS COMPLIANCE.

a\. The PHA shall comply with:

\(1\) In the case of Indian Housing Authorities (IHAs):

\(a\) Title II of the Civil Rights Act of 1968

(Indian Civil Rights Act) (25 U.S.C.

1301-1303) or Title VI of the Civil Rights

Act of 1964 (42 U.S.C. 2000d-2000d-4) and

Title VIII of the Civil Rights Act of 1968,

as amended, (42 U.S.C. 3601-3619), as

applicable. The Indian Civil Rights Act is

applicable (Title VI and Title VIII are

inappplicable) to IHAs established by

exercise of a tribe\'s powers of

self-government. In the case of an IHA

established under State law, the applicablity

of the Indian Civil Rights Act (or of Title

VI and Title VIII) will be determined by HUD

on a case-by-case basis in accordance with 24

CFR 905.105;

\* (b) Where Title VI and VIII are applicable,

Age Discrimination Act of 1975 (42 U.S.C.

6101 et seq.), 24 CFR Part 146, and Section

504 of the Rehabilitation Act of 1973 (29

U.S.C. 794), 24 CFR Part 8. \*

\(c\) Section 7(b) of the Indian Self-Determination

and Education Assistance Act (25 U.S.C.

450e(b)); and

\(d\) Executive Order 11246 (30 FR 12319) to the

maximum extent consistent with, but not in

derogation of compliance with, Section 7(b)

of the Indian Self-Determination and

Education Assistance Act.

\(2\) In the case of all other PHAs, Title VI of the

Civil Rights Act of 1964 (42 U.S.C.

\* 2000-2000d-4), 24 CFR Part 1; Fair Housing Act (42

U.S.C. 3601-36), 24 CFR Part 100; Executive Orders

11063 (Equal Opportunity in Housing), 11246 (Equal

Employment Opportunity), and 12138 (Women\'s

Business Enterprise); Section 3 of the HUD Act of

1968, as amended, (12 U.S.C. 1701u), 24 CFR Part

135; Age Discrimination Act of 1975 (42 U.S.C. \*

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\* 6101 et seq.), 24 CFR Part 146; Section 504 of the

Rehabilitation Act of 1973 (29 U.S.C. 794), 24 CFR

Part 8. \*

b\. Except for modernization work of an emergency nature,

affecting the life, health and safety of tenants, HUD

will not approve a modernization program if:

\(1\) There is a pending civil rights suit against the

PHA instituted by the Department of Justice;

\(2\) There are outstanding HUD findings of PHA

noncompliance with civil rights statutes,

executive orders, or regulations as a result of

formal administrative proceedings, unless the PHA

is implementing a HUD-approved tenant selection

and assignment plan or compliance agreement

designed to correct the area(s) of noncompliance;

or

\(3\) There has been a deferral of the processing of

applications from the PHA imposed by HUD under

Title VI of the Civil Rights Act of 1964, the

Attorney General\'s Guidelines (28 CFR 50.3) and

the HUD Title VI regulations (24 CFR 1.8) and

procedures (HUD Handbook 8040.1).

c\. Section 3 of Act of HUD Act of 1968. Under Section 3

of the HUD Act of 1968, as amended, the PHA shall

require that, to the greatest extent feasible,

opportunities for training and employment be given to

lower income persons residing within the unit of local

government or the metropolitan area (or

non-metropolitan county), as determined by the

Secretary, in which the project is located; and that

contracts for work be awarded to business concerns

which are located in or owned in substantial part by

persons residing in the same metropolitan area (or

non-metropolitan county) as the project, provided that

the contract award complies with State and local law

and Federal requirements. Refer to 24 CFR Part 135.

d\. Affirmative Action Program Under Executive Order 11246.

\(1\) PHA Contract Administration. Under Executive

Order 11246, as amended, the PHA shall advise all

construction-related contractors with contracts

over \$10,000 to document affirmative actions taken

to ensure equal opportunity in employment. This

documentation is subject to review by the

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Regional Office of the Department of Labor. As a

part of normal contract administration, the PHA is

responsible for determining compliance with the

equal opportunity clause or written affirmative

action requirements and for reviewing contractor

performance to insure that these responsibilities

are met. The PHA shall take the following action:

\(a\) Carry out sanctions against a contractor or

subcontractor and furnish information, as

required by the Department of Labor.

\(b\) Maintain an affirmative action file to keep

written reports detailing its efforts, with

dates, to meet the commitments under

Executive Order 11246, as amended.

\(c\) Assure that all PHA construction contracts

over \$10,000 are subject to Executive Order

11246, as amended, and include appropriate

provisions.

\(2\) Responsibilities of Contactors and Subcontractors.

All modernization contractors and subcontractors

are required to take affirmative action to comply

with the equal employment opportunity provisions

of Executive Order 11246, as amended.

6-2. MINORITY AND WOMEN\'S BUSINESS OR INDIAN ENTERPRISE

OPPORTUNITY.

a\. MBE Goal. Under Executive Orders 11625 and 12432, the

PHA, as part of its affirmative action program, shall

provide every feasible opportunity for minority

business enterprises (MBEs) to participate in bidding

for modernization work. The PHA shall establish

through Board resolution, the goal of at least 20

percent of its approved CIAP funds to be awarded to

contracts with MBE construction contractors, A/E\'s, or

consultants (for both physical and management

improvements), or to be purchased from MBEs under the

\* HUD Consolidated Supply Program. The 20 percent goal

is not a mandatory set-aside. Where the main \*

construction contract is awarded to an MBE, the PHA

shall count the entire dollar amount of the contract

toward the MBE goal. Where the main construction

contract is not awarded to an MBE, but one or more of

the subcontracts is awarded to an MBE, the PHA shall

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count the dollar value of such subcontract(s) toward

the MBE goal. The PHA shall not double count the

dollar value of the main construction contract and any

of its subcontracts. The PHA shall report its MBE

progress on Form HUD-2516, Contract and Subcontract

Activity Report for Public and Indian Housing

\* Programs. \*

b\. Definitions.

\(1\) MBE means a business that is owned or controlled

by one or more socially or economically

disadvantaged persons. Such persons include

Blacks, Puerto Ricans, Spanish-speaking Americans,

American Indians, Eskimos, Aleuts, Hasidic Jews,

Asian Pacific Americans, and Asian Indians.

\(2\) Owned or controlled by one or more socially and

economically disavantaged persons means that a

socially and economically disavantaged person(s),

or a for-profit business or nonprofit organization

controlled by such persons(s), possess at least 51

percent of the ownership of the business, and its

management and daily business operation are

controlled by such persons.

c\. Bid or Solicitation Process. To ensure that MBEs are

aware of modernization bid opportunities, the PHA may

wish to adopt the following suggested techniques, in

addition to its existing procedures, for publicizing

upcoming Invitations for Bid or Requests for Proposals

(see Chapter 9):

\(1\) Timely advertisement in media with a largely

minority audience;

\(2\) Solicitation of bids or requests for proposals

directly from MBEs;

\(3\) Posting of signs around the project and in the PHA

management office and local stores;

\(4\) Notification of community organizations, public or

private institutions, and local minority business

organizations and trade associations; and

\(5\) Notification of the tenant organization, if any.

d\. Women\'s Business Enterprises. Under Executive Order

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12138, both PHAs and IHAs shall take appropriate

affirmative action to assist women\'s business

\* enterprises and shall maintain information and

reports. \*

e\. Indian Enterprises. In accordance with the Indian

Determination and Education Assistance Act and the

Indian Housing regulation (24 CFR Part 905), IHAs

shall, to the greatest extent feasible, give preference

in the award of modernization contracts during any FFY

to Indian organizations and Indian-owned economic

enterprises, as defined in 24 CFR 905.106(a).

6-3. ENVIRONMENT. Before approving CIAP funds, HUD will comply

with all applicable requirements of 24 CFR Part 50,

implementing the National Environmental Policy Act (NEPA)

of 1969 (42 U.S.C. 4321 et seq.), and related requirements

of 24 CFR 50.4, pertaining to overlaying environmental

laws, Executive Orders and HUD standards. The Field Office

shall document compliance with these requirements on Forms

HUD-4128 and 4128.1, as appropriate (see paragraph 3-22).

6-4. FLOOD INSURANCE. The PHA shall comply with regulations and

requirements under the Flood Disaster Protection Act of

1973 (42 U.S.C. 4001 et seq.). The PHA shall certify that

the project to be modernized is not located in an

identified special flood hazard area, or if the project is

located in such an area, the PHA shall furnish either a

copy of the flood insurance policy obtained by the PHA to

cover the project or a certification that the special flood

hazard area has been identified for less than one year and

that the community in which the project is located is not

participating in the National Flood Insurance Program. A

project located in a special flood hazard area of a

community that has been formally notified of the area for

more than one year, but is not participating in the

National Flood Insurance Program, is not eligible for CIAP

funding until the community participates in the program.

a\. If a project is located in an identified special flood

hazard area and the community is participating in the

National Flood Insurance Program, the PHA shall obtain

flood insurance coverage for each affected building in

an amount equal to its replacement cost after the

proposed modernization (less estimated land cost) or to

the maximum limit of coverage made available with

respect to that particular type of property under the

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National Flood Insurance Act of 1968, whichever is

less. For each affected building in Lanham or PWA

projects, the PHA shall obtain flood insurance coverage

in an amount equal to its full insurable value after

the proposed modernization (less estimated land cost)

or to the maximum limit of coverage made available with

respect to that particular type of property under the

National Flood Insurance Act of 1968, whichever is

less. The PHA shall continue to carry the required

flood insurance after completion of the modernization.

Flood insurance premiums are not eligible CIAP costs.

b\. If the proposed modernization program involves new

construction or substantial improvements of an existing

structure, as defined in 44 CFR Part 60, the PHA shall

comply with the requirements on elevation and flood

proofing.

\*6-5. LEAD-BASED PAINT POISONING PREVENTION. The PHA shall

comply with the Lead-Based Paint Poisoning Prevention Act

(42 U.S.C. 4821-4826) and HUD implementing regulations.

6-6. PHYSICAL ACCESSIBILITY AND NONDISCRIMINATION BASED ON

HANDICAP. The PHA shall comply with the Architectural

Barriers Act of 1968, as amended (42 U.S.C. 4152-4157) and

HUD implementing regulations (24 CFR Part 40). The PHA

also shall comply with Section 504 of the Rehabilitation

Act of 1973, as amended (29 U.S.C. 794) and HUD

implementing regulations (24 CFR Part 8).

6-7. RELOCATION AND ACQUISITION. The Uniform Relocation

Assistance and Real Property Acquisition Policies Act of

1970, as amended (URA), and the government-wide regulations

at 49 CFR Part 24 set forth relocation requirements for

persons displaced by CIAP-funded rehabilitation, demolition

and acquisition activities. This paragraph provides an

overview of the relocation and acquisition requirements

under CIAP where the URA applies and does not apply. If

CDBG funds are used to pay any of the rehabilitation or

demolition costs of a project, the project also is subject

to the requirements of section 104(d) of the HCD Act of

1974, as amended (see paragraph 1-5).

a\. Definitions.

\(1\) A \"displaced person,\" who is eligible for

relocation assistance under the URA, means any

person (family, individual, business, nonprofit \*

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\* organization or farm) that moves from real

property, or moves personal property from real

property, permanently and involuntarily, as a

direct result of rehabilitation, demolition or

acquisition for a CIAP-funded project. Permanent,

involuntary moves for a CIAP-funded project

include:

\(a\) A permanent move from the real property

(project/site) following notice by the PHA to

move permanently from the property, if the

move occurs on or after the date that HUD

approves the PHA\'s CIAP Application;

\(b\) A permanent move from the real property that

occurs before HUD approves the PHA\'s CIAP

Application, if the PHA or HUD determines

that the displacement resulted directly from

rehabilitation, demolition or acquisition for

the CIAP-funded project;

\(c\) A permanent move from the real property by a

person that occurs after execution of the ACC

by HUD if:

\(i\) The person has not been provided a

reasonable opportunity to lease and

occupy a suitable, decent, safe and

sanitary dwelling in the same project/

site following the completion of the

project at a rent, including estimated

average utility costs, that does not

exceed the greater of the person\'s

rent and estimated average utility

costs before the initiation of

negotiations (as defined in 49 CFR

24.2(k)), or 30 percent of gross

household income; or

\(ii\) The person has been required to

relocate temporarily, but a the person

is not offered payment for all actual

reasonable moving and related expenses

incurred in connection with the

temporary relocation or other

conditions of the temporary relocation

are not reasonable, and b the person

is not offered the opportunity to

return to the same project/site; or \*

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\* (iii) The person is required to move to

another unit in the same project/site,

but is not offered reimbursement for

all actual reasonable moving and

related expenses incurred in

connection with the move.

\(2\) A person does not qualify as a displaced person

and is not eligible for relocation assistance

under the URA (see subparagraph b) or assistance

under subparagraph c), if:

\(a\) The person has been evicted for cause based

upon a serious or repeated violation of

material terms of the lease or occupancy

agreement and the PHA determines that the

eviction was not undertaken for the purpose

of evading the obligation to provide

relocation assistance (see 49 CFR 24.206);

\(b\) The person moved into the property after HUD

approval of the PHA\'s CIAP Application and,

before commencing occupancy, received written

notice of the expected displacement;

\(c\) The person is ineligible under 49 CFR 24.2(g)

(2); or

\(d\) The PHA determines that the person was not

displaced as a direct result of CIAP-funded

rehabilitation, demolition or acquisition for

the project and the Field Office concurs in

that determination. This category includes

general transfers between projects. The PHA

shall not use CIAP funds to pay for actual

reasonable moving and related expenses for

general transfers. To minimize disputes

regarding eligibility, PHA records shall

state the cause of general transfers.

\(3\) A person does not qualify as a displaced person,

but must be provided assistance under subparagraph

c if due to CIAP-funded rehabilitation or

demolition, the person is moved temporarily from

the project/site and is offered the opportunity to

return to the same project/site (although not

necessarily the same building/unit) or the person

is moved permanently within the same project/

site. \*

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\(4\) At any time, the PHA may request a HUD

determination as to whether a person qualifies as

a displaced person and, if not, whether a person

is eligible for assistance.

b\. Relocation Assistance for Displaced Persons. The

following requirements apply to displaced persons, as

defined in subparagraph a(1):

\(1\) Relocation Notices to Families or Individuals.

The PHA shall provide written notices (general

information notice and notice of relocation

eligibility), as required by 49 CFR 24.203. Each

notice shall be personally served or sent by

certified or registered first-class mail, return

receipt requested, and documented in the PHA\'s

files. Each notice shall be written in plain,

understandable language. Persons who are unable

to read and understand the notice (e.g.,

illiterate, foreign language, or impaired vision)

must be provided with appropriate translation/

communication and counseling. Each notice shall

indicate the name and telephone number (including

the TDD number, if applicable) of a person who may

be contacted for answers to questions or other

needed help.

\(2\) Relocation Planning, Advisory Services, and

Coordination. The PHA shall undertake relocation

planning, provide relocation assistance advisory

services, and properly coordinate relocation

activities as required by 49 CFR 24.205. The PHA

shall not require any family or individual to move

unless it has provided at least one referral

(where possible, three or more) to a comparable

replacement dwelling (CRD), as defined in 49 CFR

24.2(d).

\(3\) Payments for Moving and Related Expenses. Refer

to 49 CFR Part 24, Subpart E.

\(a\) Family or Individual.

\(i\) The PHA may, at its discretion, elect

to perform the move itself, using

force account labor or a moving

company, at no cost to the family or

individual being displaced. In such

case, the PHA also shall provide the

family or individual with a moving \*

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\* expense and dislocation allowance of

\$50.

\(ii\) If the PHA does not elect to Perform

the move itself, the family or

individual shall have the option to

elect either a payment for actual

reasonable moving and related expenses

(49 CFR 24.301) or the applicable

fixed moving expense and dislocation

allowance (49 CFR 24.302) indicated in

the schedule, which is published

periodically in the Federal Register

by the Department of Transportation

and available from the Field Office.

\(b\) Business or Nonprofit Organization. Such

entity is eligible for a payment for actual

reasonable moving and related expenses (49

CFR 24.303) and a payment for

reestablishment expenses (49 CFR 24.304).

Section 24.305 describes those businesses/

nonprofit organizations which may qualify to

choose a fixed payment in lieu of the

payments under 49 CFR 24.303 and 24.304.

\(4\) Replacement Housing Assistance. It is expected

that most families or individuals displaced from a

dwelling will be provided the opportunity to

relocate to another public housing unit that

qualifies as a CRD. This will satisfy the basic

replacement housing requirements of the URA and,

ordinarily, no additional cash replacement housing

assistance would be necessary. If the PHA does

not provide referrals to comparable subsidized

housing, the family or individual will be entitled

to cash assistance sufficient to rent a CRD on the

private market for a 42-month period. The family

or individual may use the cash payment to rent or

buy a replacement dwelling. If the family or

individual rents a replacement dwelling, the

payment shall not exceed the amount needed to rent

the decent, safe and sanitary dwelling to which

the family or individual relocates. At its

discretion, the PHA may provide a rental

assistance payment in monthly installments. If

the family or individual elects to buy a decent,

safe and sanitary replacement dwelling, the PHA

shall provide the payment in a lump sum amount. \*

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\* (5) Appeals. A person who disagrees with the PHA\'s

determination concerning a payment or other

assistance required under subparagraph b may file

a written appeal of that determination with the

PHA. The PHA shall follow the appeal procedures

set forth in 49 CFR 24.10.

c\. Assistance for Persons Who Must Move, But are Not

Displaced. Families or individuals who are not

displaced, but must move temporarily, or move

permanently within the same project/site, are entitled

to reimbursement of costs incurred. The PHA shall

provide temporary housing which is decent, safe and

sanitary at the same cost on a nondiscriminatory basis

for a family or individual who is moved temporarily

from the project/site and is offered the opportunity to

return to the same project/site (although not

necessarily the same building/unit).

\(1\) Notice to Families or Individuals. As soon as

possible, the PHA shall provide written notice to

each affected family or individual that they will

be moved, but are not being displaced.

\(2\) Direct Payment or Reimbursement. The PHA

shall either (a) undertake the move itself, using

force account labor or a moving company, and

therefore be directly responsible for all actual

reasonable moving and related expenses; or (b)

reimburse families or individuals for all actual

reasonable moving and related expenses. In the

latter case, the PHA shall not make fixed payments

since such payments are not representative of

actual reasonable costs.

\(3\) Incidental Costs. Incidental costs may include

utility deposits if required at the temporary

housing, and telephone installation and cable TV

hook-up at the temporary housing and the newly

rehabilitated project if the family or individual

previously had a telephone and cable TV. If the

newly rehabilitated project now has

tenant-purchased rather than PHA-furnished

utilities, which require utility deposits, the PHA

shall not pay for the new utility deposits since

they are required to be paid by any family or

individual currently living in a project which is

being converted to tenant-purchased utilities or

by any new family or individual moving into such

project. \*

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\* (4) Cost of Temporary Housing. When it is necessary

to temporarily house families or individuals in

units other than public housing, rents paid by the

PHA shall not exceed Section 8 Fair Market Rents,

except as may be approved by the Field Office.

When a public housing unit of suitable size and

location becomes available, the family or

individual must agree to move into the unit or

assistance shall terminate.

d\. Assistance in Place. Where families or individuals are

not required to move, but are unable to use their

kitchens for a short period of time or be in their

units during the day due to modernization activities,

the Field Office may approve CIAP funds for meal

vouchers where the PHA can demonstrate that the cost of

the meal vouchers is less than the cost of temporary

moves.

e\. Costs of Assistance. Costs of assistance under this

paragraph may be paid from local public funds, CIAP

funds, or funds available from other sources.

f\. Recordkeeping Requirements. The PHA shall maintain

records in sufficient detail to demonstrate compliance

with applicable relocation requirements. The PHA shall

retain these records for at least three years after the

later of: (1) the date the person has received all of

the assistance to which the person is entitled; or (2)

the date the project is completed. Relocation records

shall include the following:

\(1\) Displaced Persons. For persons displaced, the PHA

shall maintain separate case files that include:

\(a\) Identification of the person\'s name and

racial/ethnic group classification and the

address of the displacement property. For

residential persons, include age, sex and

income of all members of the household,

monthly rent, average monthly utility costs,

and date of initial occupancy of the

displacement property. For nonresidential

persons, include type of enterprise.

\(b\) Evidence that the person received timely

written notice of possible displacement and a

general description of the relocation

payments and advisory services for which

the \*

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\* person may be eligible, basic eligibility

conditions, and procedures for obtaining

payments.

\(c\) Evidence that the person received timely

written notice of eligibility for relocation

assistance and, for a displaced residential

person, the specific CRD and related cost to

be used to establish the upper limit of the

replacement housing payment.

\(d\) Identification of relocation needs and

preferences, dates of personal contacts, and

services provided.

\(e\) Identification of referrals to replacement

properties, dates of referrals, rent/utility

costs or sales price (if residential), date

of availability, and reason(s) person

declined referral.

\(f\) Copy of 90-day notice and vacate notice, if

issued.

\(g\) Identification of address of replacement

property and date of relocation. If

residential, identify rent/utility costs or

sales price.

\(h\) Copy of replacement dwelling inspection

report showing condition of unit and date of

inspection.

\(i\) Copy of each approved claim form and related

documentation, evidence that person received

payment, and, if applicable, Section 8

Certificate or Housing Voucher.

\(j\) Copy of any appeal or complaint filed and PHA

response.

\(2\) Persons Not Displaced. For persons not displaced,

the PHA shall maintain the following

documentation:

\(a\) Evidence that the person received timely

written notice that he/she would not be

displaced by the project.

\(b\) Evidence that, where applicable, the person \*

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\* received a timely offer of (l) a reasonable

opportunity to lease and occupy a suitable

unit in the same project/site and (2)

reimbursement of any out-of-pocket expenses

incurred in connection with any temporary

relocation or a permanent move to another

unit in the same project/site.

\(c\) For each person that is not displaced, but

elects to move permanently from the

project/site, an indication of the reason for

the move and any personal contact to explain

that the person will not qualify for

relocation payments as a \"displaced person.\"

g\. Real Property Acquisition Requirements. The

acquisition of real property with CIAP funds is subject

to the URA and the requirements set forth in 49 CFR

Part 24, Subpart B. These provisions include

requirements to appraise the real property and offer

fair market value, in writing, to the owner before

negotiating to acquire the property and to pay the cost

of all incidental expenses.

h\. Technical Assistance. The PHA shall direct all

questions on relocation to the HMS. The HMS will refer

questions regarding relocation under the URA to the

Relocation/Realty Specialist in the Community Planning

and Development Division and regarding equal

opportunity and fair housing to the Equal Opportunity

Specialist.

6-8. ENERGY CONSERVATION. The PHA shall update the energy audit

to identify cost-effective energy conservation measures \*

(ECMs) under 24 CFR Part 965, Subpart C, before HUD

approval of comprehensive, special purpose or homeownership

modernization for a project. The energy audit shall be

updated for those ECMs where the energy costs are now

substantially different from when the audit was last

conducted. The energy audit may be performed by using HUD

Workbook (HUD-PDR-700(3)), State standards, or other

HUD-approved methods. Refer to Handbook 7418.1 on

Preparation of a Life-Cycle Cost Analysis for Utility

Combinations for guidance on useful life. The cost of

performing or updating an energy audit is an eligible

CIAP cost.

6-9. WAGE RATES. Before bid advertisement, the PHA shall

consult with the Field Office General Engineer on the

applicable wage rates to apply. The General Engineer, in

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turn, shall consult with the Field or Regional Labor

Relations staff concerning the advice given to the PHA.

The General Engineer shall document the consultations with

the PHA and Labor Relations Staff. The PHA shall request

the wage rates from the Field Office Labor Relations staff

or the Regional Office where the labor relations function

has been regionalized. In providing the wage rates, the

Field or Regional Labor Relations staff, as appropriate,

shall make the final decision on the applicable wage rates.

Appendix 14 provides guidance on the classification of work

items by wage rate.

a\. HUD-Determined Wage Rates.

\(1\) Legislative Provisions. Under Section 12 of the

Act, the PHA and its contractors shall pay not

less than the wages prevailing in the locality, as

determined or adopted by HUD, to all laborers and

mechanics employed by the PHA or its contractors

in carrying out nonroutine maintenance as defined

in paragraph 1-3.

\(2\) PHA Request. At least 45 days before bid

advertisement for contract labor or before start

of work for force account labor, the PHA shall

request a current schedule of HUD-determined wage

rates. See paragraphs 9-4h(5) and 9-17 for

contract wage and payroll requirements and the

Labor Standards Handbook 1344.1 REV-1 for labor

standards compliance procedures.

\(3\) HUD-Determined Rates. Where it has been

determined that the work is nonroutine maintenance

and, therefore, is not subject to Davis-Bacon wage

rates, the following procedure shall be used to

establish the HUD-determined rates.

\(a\) Construction Trade Classifications. Where

the PHA has requested construction trade

classifications and the PHA itself employs

such trade classifications, such as

carpenter, painter and plumber, the current

basic hourly rates shall be issued by HUD to

the PHA on Form HUD-52158, Maintenance Wage

Rate Determination, for those trades in

question.

\(b\) Maintenance Wage Classifications. Where Form

HUD-52158 does not contain a suitable

maintenance classification required for the

CIAP work, the basic hourly rates for these

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maintenance classifications whose principal

duties are consistent with the CIAP work to

be performed shall be used. PHA supervisory

maintenance personnel shall not be

considered.

\(c\) Survey-Based Classifications. If Form

HUD-52158 does not contain suitable

classifications which are applicable to the

proposed work to be performed, the Field or

\* Regional Labor Relations staff shall request

a survey from the PHA. The survey shall be

of a representative number of local public

and private employers who do the work in \*

question. A weighted average of the wage

data derived shall be used in determining the

applicable rate or rates. If the work to be

performed typically involves the use of

helpers or laborers, data for those

classifications also shall be gathered and

HUD may issue such classifications. The

Field or Regional Labor Relations staff at

its option may conduct the surveys required.

The contractor or PHA may not reduce the

HUD-determined basic hourly rate by taking an

\* hourly credit for fringe benefits. The Field

or Regional Labor Relations staff shall

determine the wage rates after reviewing the

survey data submitted by the PHA or received

in any survey conducted by the staff. \*

\(d\) Basic Hourly Rate. HUD-determined wage rates

shall be the basic hourly rates excluding the

monetary value of fringe benefits.

b\. Davis Bacon Wage Rates.

\(1\) Legislative Provisions. Under Section 12 of the

Act, the PHA and its contractors shall pay not

less than the wages prevailing in the locality, as

predetermined by the Secretary of Labor, under the

Davis-Bacon Act (40 U.S.C. 276a-276a-5), to all

laborers and mechanics employed by the PHA or its

contractors in carrying out modernization work or

contracts over \$2,000, except work classified as

nonroutine maintenance.

\(2\) PHA Request. At least 45 days before bid

advertisement for contract labor or before start

of work for force account labor, the PHA shall

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prepare and submit Standard Form 308, Request for

Wage Determination. See paragraphs 9-4h(5) and

9-17 for contract wage and payroll requirements

and Handbook 1344.1 REV-1 for labor standards

compliance procedures.

c\. Single Construction Contracts. Each construction

contract shall contain only a single wage rate

determination. If there is a substantial amount of

work in each category (development and nonroutine

maintenance), separate contracts should be awarded for

each category. If only an incidental amount of work is

subject to either type of wage decision, then that work

should be included in the contract containing the

substantial amount of work.

d\. Contract Work Hours and Safety Standards. The PHA and

its contractors shall comply with the Contract Work

Hours and Safety Sandards Act (40 U.S.C. 327-333),

including overtime provisions, for all laborers and

mechanics employed by the PHA or its contractors in

carrying out modernization work or contracts, under

either HUD-determined or Davis-Bacon wage rates.

e\. Technical Wage Rates. The PHA and its contractor shall

pay not less than HUD-determined prevailing wage rates

to all architects, technical engineers, draftsmen and

technicians employed in the modernization of a project.

\* f. State Prevailing Wage Rates. Prevailing wage rates

determined under State or tribal law are inapplicable

under the circumstances set forth in 24 CFR 968.120.

When the conditions of 24 CFR 968.120(a) are met, the

PHA shall follow the procedures set forth in 24 CFR

968.120(b). \*

6-10. INSURANCE

a\. Review of Existing Coverages.

\(1\) The PHA is required to have in effect: (a)

workers\' compensation insurance; (b) fire and

extended coverage insurance; (c) comprehensive

general liability insurance; (d) automobile

liability insurance for both PHA-owned and

non-owned automobiles; and (e) a fidelity bond.

In many instances, the additional exposures

created by the modernization activities can be

insured by either an endorsement to the existing

policy or a

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letter from the insurance broker/company,

acknowledging that existing policy as written is

broad enough to include the additional exposures.

\(2\) Following modernization program approval, the PHA

shall notify the insurance broker/company in

writing of the modernization activities and

request written advice concerning what steps, if

any, need to be taken to ensure proper coverage.

The PHA\'s letter shall describe the modernization

activities in sufficient detail to allow the

insurance broker/company to decide what coverage

would be adequate. This description shall include

the type and cost of work to be performed, the

nature of any structural alterations, and the

involvement of PHA employees in the work. The PHA

shall send a copy of any policy endorsement or

written permission from the insurance

broker/company to the Field Office for attachment

to its existing policy.

b\. Fire and Extended Coverage. In addition to the general

requirements set forth in subparagraph a, the following

special requirements apply to fire and extended

coverage:

\(1\) Where the modernization work is to be performed by

contract and is insured under the PHA\'s existing

policy, the PHA shall notify the contractor of

this coverage.

\(2\) If the existing policy cannot be endorsed to

include the modernization activities because of

substantial structural alterations, the PHA shall

obtain a builder\'s risk policy on a \"100%

Comppleted Value\" either directly or through the

contractor. This policy shall remain in effect

through substantial completion of the

modernization work, at which time the coverage

\* shall be transferred to the PHA\'s existing policy.

\*

c\. Comprehensive General Liability. In addition to the

general requirements set forth in subparagraph a, the

PHA shall obtain an endorsement to the comprehensive

general liability policy to include owners\' and

contractors\' protective liability coverage to protect

the PHA from any claims arising from the contractor\'s

operations. Under no circumstances shall the PHA

assume the liability of the contractor under \"Hold

Harmless\" or contractual liability clause.

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d\. Contractor Insurance.

\(1\) Required Insurance. Before beginning work, the

contractor and each subcontractor shall furnish

the PHA with certificates of insurance showing

that the following insurance is in force and will

\* insure all operations under the contract. All

insurance shall be carried with companies which

are financially responsible and authorized to do

business in the State in which the project is

located. \*

\(a\) Workers\' Compensation, in accordance with

State or Territorial Workers\' Compensation

laws, for all employees engaged under the

modernization contract.

\(b\) Commercial General Liability which is

comprehensive general liability insurance

with bodily injury and property damage. The

minimum amount of required coverage is

\$500,000 per occurrence. The policy shall

cover all operations of the contractor in

connection with the project, including use of

all equipment, hoists, and vehicles on the

project site.

\(c\) Automobile Liability on owned, non-owned and

hired motor vehicles used on or in connection

with the site(s) for a combined single limit

for bodily injury and property damage of not

less the \$500,000 per occurrence.

\(2\) Builder\'s Risk. Before beginning work, the

contractor shall furnish the PHA with a

certificate of insurance evidencing that builder\'s

risk (fire and extended coverage) insurance on all

work in place and/or materials stored at the

building site(s), including foundations and

building equipment, is in force. The builder\'s

risk insurance shall be for the benefit of the

contractor and the PHA as their interests may

appear and each shall be named in the policy or

policies as an insured. The contract in

installing equipment such as ranges and

refrigerators supplied by the PHA shall carry

insurance on such equipment from the time the

contractor takes possession thereof until the

contract work is accepted by the PHA. The

builder\'s risk insurance need not be carried on

excavations, piers, footings or

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foundations until such time as work on the

superstructure is started. It need not be carried

on landscape work. Policies shall furnish

coverage at all times for the full cash value of

all completed construction, as well as materials

in place and/or stored at the site(s), whether or

not partial payment has been made by the PHA. The

contractor may terminate this insurance on

buildings taken over for occupancy by the PHA as

of the date the buildings are taken over. The

contractor is not required to carry builder\'s risk

insurance for modernization work which does not

involve structural alterations or additions and

where the PHA\'s existing fire and extended

coverage policy can be endorsed to include such

work.

\(3\) Expiration or Cancellation. If any insurance is

due to expire during the construction period, the

contractor (including subcontractors, as

applicable) shall not permit the coverage to lapse

and shall furnish evidence of coverage to the PHA

and its Contracting Officer. All certificates of

insurance, as evidence of coverage, shall provide

that no coverage may be canceled or non-renewed by

the insurance company until at least 30 days prior

written notice has been given to both the PHA and

its Contracting Officer.

\(4\) Noncompliance. The PHA shall monitor the

insurance policies obtained by all contractors and

subcontractors to ensure that the coverage

required by the modernization contract is kept in

force until the contractor\'s work is accepted by

the PHA. The PHA shall notify the contractor to

stop work if the required insurance coverage is

not in force at the time the work begins or if the

coverage expires before the work is accepted. The

PHA also shall notify the contractor that any such

work stoppage is an infraction of the contract and

that the contractor is liable for any losses or

delays.

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