#### § 1726.14 Definitions.

Terms used in this part have the meanings set forth in 7 CFR 1710.2. References to specific RUS forms and other RUS documents, and to specific sections or lines of such forms and documents, shall include the corresponding forms, documents, sections and lines in any subsequent revisions of these forms and documents. In addition to the terms defined in 7 CFR 1710.2, the following terms have the following meanings for the purposes of this part:

*Approval of proposed construction* means RUS approval of a construction work plan or other appropriate engineering study and RUS approval, for purposes of system financing, of the completion of all appropriate environmental review requirements in accordance with 7 CFR part 1970.

*Architect* means a registered or licensed person employed by the borrower to provide architectural services for a project and duly authorized assistants and representatives.

*Bona fide bid* means a bid which is submitted by a contractor on the borrower's list of qualified bidders for the specific contract, prior to bid opening.

*“Buy American” certificate* means a certification that the contractor has complied with the “Buy American” requirement (see § 1726.15).

*Competitive procurement* means procurement of goods or services based on lowest evaluated bid for similar products or services when three or more bids are received.

*Construction unit* means a specifically defined portion of a construction project containing materials, labor, or both, for purposes of bidding and payment.

*Contracting committee* means the committee consisting of three to five members representing the borrower's management and board of directors and the engineer. The contracting committee represents the borrower during contract clarifying discussions or negotiations under informal competitive bidding or multiparty negotiation, respectively.

*Encumbrance* means the process of approval for advance of loans funds by RUS.

*Engineer* means a registered or licensed person, who may be a staff employee or an outside consultant, to provide engineering services and duly authorized assistants and representatives.

*Equipment* means a major component of an electric system, e.g., a substation transformer, heat exchanger or a transmission structure.

*Force account construction* means construction performed by the borrower's employees.

*Formal competitive bidding* means the competitive procurement procedure wherein bidders submit sealed proposals for furnishing the goods or services stipulated in the specification. Bids are publicly opened and read at a predetermined time and place. If a contract is awarded, it must be to the lowest evaluated responsive bidder (see § 1726.201).

*Goods or services* means materials, equipment, or construction, or any combination thereof.

*Informal competitive bidding* means the competitive procurement procedure which provides for private opening of bids and allows clarifying discussions between the contracting committee and the bidders. During the clarifying discussions any exceptions to the bid documents must be eliminated, or the bid rejected, so that the contract is awarded to the lowest evaluated responsive bidder (see § 1726.202).

*Material* means miscellaneous hardware which is combined with equipment to form an electric system, e.g., poles, insulators, or conductors.

*Minor error or irregularity* means a defect or variation in a bid that is a matter of form and not of substance. Errors or irregularities are “minor” if they can be corrected or waived without being prejudicial to other bidders and when they do not affect the price, quantity, quality, or timeliness of construction. A minor error or irregularity is not an exception for purposes of determining whether a bid is responsive.

*Minor modification or improvement* means a project the cost of which is $250,000 or less, exclusive of the cost of owner furnished materials.

*Multiparty lump sum quotations* means the procurement of goods or services on a lump sum basis, based on the lowest evaluated offering, when three or more offers are received. (See § 1726.205).

*Multiparty negotiation* means the procurement procedure where three or more bids are received and provides for negotiations between the contracting committee and each bidder to determine the bid which is in the borrower's best interest (see § 1726.203).

*Net utility plant (NUP)* means Part C, Line 5 of RUS Form 7 for distribution borrowers or Section B, Line 5 of RUS Form 12a for power supply borrowers for the immediately preceding calendar year.

*Procurement method* means a procedure, including, but not limited to, those in subpart G of this part, that a borrower uses to obtain goods and services.

*Owner furnished materials* means materials or equipment or both supplied by the borrower for installation by the contractor.

*Responsive bid* means a bid with no exceptions or non-minor errors or irregularities on any technical requirement or in the contract terms and conditions.

*RUS approval* means written approval by the Administrator or a representative with delegated authority. RUS approval must be in writing, except in emergency situations where RUS approval may be given over the telephone followed by a confirming letter.

*Unit prices* means individual prices for specific construction units defined in accordance with RUS approved units specified in RUS standard contract forms.

[60 FR 10155, Feb. 23, 1995, as amended at 77 FR 3071, Jan. 23, 2012; 81 FR 11027, Mar. 2, 2016; 89 FR 17275, Mar. 11, 2024]