The intent of this Subpart is to provide for maximum open and
free competition in the procurement of materials, goods and services for the
construction of projects funded from the PWSLP. Any procurement method, except
as allowed under this Part, that significantly minimizes open and free
competition will be prohibited. The following procedures shall apply to
subagreements:
a) Local Preference
Local laws, ordinances, regulations or procedures that are
designed to or operate to give local or in-state bidders or proposers
preference over other bidders or proposers shall not be used in evaluating bids
or proposals for subagreements under PWSLP loans.
b) Profits
Only fair and reasonable profits may be earned by contractors
in subagreements under PWSLP loans. Profit included in a formally advertised,
competitively bid, fixed price construction contract awarded pursuant to
Section 662.620 (Construction Contracts)
is presumed to be reasonable. If a subagreement is not competitively bid, the
loan recipient shall submit to the Agency its basis for determination of
reasonable profit.
c) Loan
Recipient Responsibility
The loan recipient shall be responsible for the
administration and successful accomplishment of the project for which PWSLP
loan assistance is provided. The loan recipient shall be responsible for the
settlement and satisfaction of all contractual and administrative issues
arising out of subagreements, including, but not limited to, issuance of
invitations for bids or requests for proposals, selection of contractors, award
of contracts, protests of award, claims, disputes, and other procurement
matters. With the prior written consent of the Agency, these functions may be
performed for the loan recipient by an individual or firm retained for that
purpose. The individual or firm shall be deemed the loan recipient's agent and
shall be subject to all the provisions of the loan agreement and all the
provisions of this Part that apply to the loan recipient.
d) Privity of Contract
Neither the Agency nor the State of Illinois shall be a party
to any subagreement (including contracts or subcontracts) or to any
solicitation or request for proposals under those subagreements.
e) Subagreements shall:
1) be directly related to the accomplishment
of the loan recipient's approved work program;
2) be in the form of an executed written
agreement (except for small purchases of $25,000 or less);
3) be for monetary or in-kind consideration;
and
4) not be in the nature of a
grant or gift.
f)
Documentation
1) Procurement records and files
for purchases in excess of $25,000 shall include the following:
A) the basis for contractor
selection;
B) the justification for
lack of competition if competition appropriate to the type of project work to
be performed is required but not obtained; and
C) the basis for award cost or
price.
2) Procurement
documentation as described in subsection (f)(1) shall be retained by the loan
recipient or contractors for the period required by Section
662.470 (Ongoing Auditing and
Monitoring Financial Capability).
g) Subagreements shall only be awarded to
persons or organizations that:
1) Have
adequate financial resources for performance;
2) Have the necessary experience,
organization, technical qualifications, and facilities, or a firm commitment,
arrangement, or ability to obtain these requirements;
3) Have the staffing sufficient to comply
with the proposed or required completion schedule for the project;
4) Have a satisfactory record of integrity,
judgment, and performance;
5) Have
an adequate financial management system and audit procedure that is consistent
with U.S. generally accepted auditing standards;
6) Maintain a standard of procurement in
accordance with this Part;
7)
Maintain a property management system that provides adequate procedures for the
acquisition, maintenance, safeguarding and disposition of all property;
and
8) Conform to the civil rights,
equal employment opportunity, and labor law requirements of this
Part.
h) Fraud and Other
Unlawful or Corrupt Practices
1) The obtaining
and administration of loans from the PWSLP, and of subagreements awarded by
loan recipients, shall be free from bribery, graft, kickbacks, and other
corrupt practices. The loan recipient shall bear the primary responsibility for
prevention and detection of that conduct and for cooperation with appropriate
authorities in the prosecution of any such conduct.
2) The loan recipient shall effectively
pursue available State or local legal and administrative remedies and take
appropriate remedial action with respect to any allegations or evidence of
illegality or corrupt practices brought to its attention. The loan recipient
shall advise the Agency immediately when any allegation or evidence comes to
its attention and shall periodically advise the Agency of the status and
ultimate disposition of any matter.
i) Negotiation of Subagreements
All subagreements greater than $25,000 shall be awarded by
formal advertising unless the loan recipient determines, and the Agency
concurs, that it is impracticable and infeasible to use formal advertising.
Negotiated contracts must be competitively awarded to the maximum practicable
extent and not be in conflict with other State statutes. Procurements may be
negotiated by the loan recipient, if approved by the Agency, for the following
reasons:
1) Public exigency, as
evidenced by governmental declaration, will not permit the delay incident to
advertising (e.g., an emergency procurement);
2) The aggregate amount of the contract to be
competitively negotiated is allowed by State law;
3) The materials or services to be procured
are available from only one person or firm;
4) The procurement is for personal or
professional services, or for any services to be rendered by an educational
institution;
5) No responsive,
responsible bids at acceptable price levels have been received after formal
advertising; or
6) The procurement
is for material or services for which the prices are established by law; for
technical items or equipment requiring standardization and interchangeability
of parts with existing equipment; for experimental, developmental or research
work; for highly perishable materials; for resale; or for technical or
specialized supplies requiring substantial initial investment for
manufacture.
