In design-build contracting, construction firms respond to an
RFP by submitting building designs to meet the grantee's (owner's)
performance requirements within a guaranteed maximum price (see
GMP requirements under
"Construction Management Services"
in this section) that covers all architectural, engineering, and
construction services required. The design-build firm must be
selected in a manner that will allow maximum feasible competition.
The selection must be accomplished by a process that includes
public announcement of RFPs, provided that at least one form of
the announcement receives nationwide distribution; consideration
of all proposals from firms that are determined to be qualified;
and selection based on the firms' qualifications, responsiveness
to the criteria in the RFP, and cost.
Because of the nature of design-build contracting, the following
departures from sealed bidding are authorized:
- Technical considerations as well as cost may be treated as
- The grantee (owner) may negotiate cost or design with one
or any number of firms.
On all design-build projects, the owner must ensure a firm total
cost by including in the design-build contract a provision that
extra costs resulting from errors or omissions in the drawings
or estimates will be the design-build firm's responsibility.
Equal Employment Opportunity, Labor
Standards, and Other Contract Requirements
Labor standards and equal employment opportunity requirements
for federally assisted construction must be specified in the information
provided to bidders on construction contracts under NIH grants
and must be included in the contract documents for all such projects
(see 45 CFR Part 74, Appendix A, and 45 CFR 92.36(i)). NIH construction
grants are not subject to the requirements of the Davis-Bacon
Act or the Copeland "Anti-Kickback" Act.
EQUAL EMPLOYMENT OPPORTUNITY
Construction contracts (and subcontracts) awarded under NIH grants
are subject to the requirements of Executive Order 11246 (September
24, 1965), as amended, as implemented in 41 CFR Part 60-1 by the
Office of Federal Contract Compliance Programs (OFCCP), U.S. Department
of Labor. The grantee is required to include the "Equal
Opportunity Clause" at 41 CFR 60-1.4(b) in any construction
contract exceeding $10,000 under the grant. The contractor must
be directed to include this clause in any applicable subcontracts.
In addition, grantees and construction contractors under NIH grants
are required to comply with the solicitation and contract requirements
for affirmative action specified in 41 CFR Part 60-4 for contracts
that will exceed $10,000 in designated geographical areas. These
requirements are specified in the "Notice of Requirement
for Affirmative Action To Ensure Equal Employment Opportunity
(Executive Order 11246)" and the "Standard Federal Equal
Employment Opportunity Construction Contract Specifications (Executive
The OFCCP regulations also require that the grantee notify the
applicable OFCCP regional, area, or field office when it expects
to award a construction contract(s) that will exceed $10,000.
Further information about these requirements and the full text
of these regulations is available at
Pursuant to 41 CFR 60-1.8, the grantee shall require each prospective
construction contractor for a contract that will exceed $10,000
to submit a certification that the contractor does not, and will
not, maintain any facilities it provides for its employees in
a segregated manner, or permit its employees to perform their
services at any location, under the contractor's control, where
segregated facilities are maintained, and the contractor will
obtain a similar certification prior to the award of any covered
Contract Work Hours and Safety Standards
Construction contractors and subcontractors with contracts/subcontracts
exceeding $100,000 under NIH grants are subject to the requirements
of the Contract Work Hours and Safety Standards Act, 40 U.S.C.
327-333, concerning the payment of overtime and the maintenance
of healthful and safe working conditions.
Wages paid any laborer or mechanic employed by the contractor
or subcontractor must be computed on the basis of a standard workweek
of 40 hours. For all work in excess of the standard workweek,
mechanics and laborers shall be compensated at a rate not less
than one-and-a-half times the basic rate of pay. If this requirement
is violated, the contractor or subcontractor is liable to the
employee for the unpaid wages and may be liable to the Government
for liquidated damages. NIH or the grantee may withhold otherwise
payable funds to satisfy any such liability. The statute also
specifies penalties for intentional violation of these requirements.
Further, no contractor or subcontractor under an NIH grant shall
require any laborer or mechanic employed in the performance of
the contract to work in surroundings or under working conditions
that are unsanitary, hazardous, or dangerous to an individual's
health or safety, pursuant to standards issued by the Secretary
of Labor. Violation of these requirements may be cause for debarment
from future Federal contracts or financial assistance.
Invitations for bids must stipulate a time for completion of the
project, expressed either in calendar days or as a fixed date,
for each prime contract to be awarded under the project.
At the option of the grantee (owner), a liquidated damages provision
may be included in the construction contract, allowing for assessment
of damages when the contractor has not completed construction
by the date specified in the contract. Liquidated damages must
be real and justified and must be approved by NIH prior to solicitation.
Where there is an assessment of damages, any amounts paid belong
to the owner.
DISPOSITION OF UNCLAIMED WAGES
If it is discovered, either during or after the period of performance
of an NIH-assisted construction contract, that an employee is
entitled to wages but cannot be located for the purposes of payment
(or for some reason refuses to accept payment), the grantee may
eventually have to repay the Federal Government. Therefore, NIH
suggests that the contractor be required to turn over any unclaimed
wages to the grantee.
The grantee should notify the GMO that an escrow account has been
established in the affected employee's name and should maintain
the account for a period of either 2 years following the completion
of the contract or such longer period as may be required by State
or local law. Upon the expiration of this period, any amounts
still unclaimed will be disbursed by refunding to NIH either the
entire amount, if the construction project was 100 percent funded
by NIH, or an amount representing the percentage of NIH participation
in the project. In the event the project was funded by more than
one NIH or HHS program at differing rates, the percentage on which
the refund is based should be an average percentage calculated
by weighting each program's rate of participation by the dollar
amount of that program's contribution.
If the contractor has made a reasonable effort to locate the employee
by having mail forwarded and contacting the employee's union,
the grantee need not repeat such attempts. If there is reason
to believe that the contractor's efforts to locate employees that
are due wages were not thorough, the grantee should attempt to
locate the employees. Doing so will reduce the likelihood of
future claims against the grantee.
If any wages held in escrow are paid to an employee or an employee's
legal representative during the period in which the account is
maintained, a complete report must be made to the IC GMO when
the account is closed.
PRIOR APPROVAL REQUIREMENTS
Grantees (owners) must obtain written prior approval from the
IC GMO for grantee-initiated changes in project or budget as follows:
- A revision that would result in a change in scope or objectives
of the project, including proposed modifications that would materially
alter the costs of the project, including unit costs, space utilization,
or financial layout, and resulting changes in the previously approved
solicitation or contract.
- A revision that would increase the amount of Federal funds
needed to complete the project.
- Any other applicable change as specified in
Changes in Project and Budget".
grants are not eligible for expanded authorities.
The request for approval shall include sufficient information
to allow NIH review of the circumstances and need for the proposed
change. After receipt of written prior approval from the IC GMO,
the grantee may authorize the approved modification(s) of the
construction contract. Other less-substantive modifications to
construction contracts may be accomplished without the prior approval
of the NIH awarding office. However, copies of all change orders
to construction contracts must be retained as grant-related records
(see "Administrative Requirements
Retention and Access").
Alteration and Renovation Projects
under Nonconstruction Grants
Two copies of each of the following documents are to be submitted
with each request for approval of A&R costs greater than $300,000,
but not more than $500,000, (whether proposed in the application
or as a postaward rebudgeting request):
- A single line drawing of the existing space and proposed alterations.
- A narrative description of the proposed functional utilization
of the space and equipment requirements prepared by the program
and administrative managers who will use and be responsible for
the working space and, when appropriate, with input from architectural
and engineering advisors. Final drawings and specifications will
be based on this description.
- The description shall include a detailed explanation of the
need, character, and extent of the functions to be housed in the
space proposed for A&R, using the following headings, as appropriate:
- General information,
- Description of the functions to be performed in the space,
- Space schedule (detailed description of floor space),
- List of fixed equipment proposed for the facility,
- Cost estimate (see sample format in Exhibit 1),
- Special design problems,
- Description of the existing and proposed utility systems for
the modified space,
- Description of plans to provide accessibility for the physicallyhandicapped,
- Provisions for meeting the requirements of the Life SafetyCode,
- The length of the property lease if the space is rented, and
- Other information required by program legislation or regulations.
When the proposed alteration is to occur in a building that is
under construction or in an incomplete structure, two copies of
the following documentation must also be provided:
- A detailed justification for the need to perform the work
before the building is completed,
- A cost comparison between doing the work before and after
the building is completed, and
- A description of other specific benefits to be gained by doing
the work before the building is completed.
Applicants/grantees undertaking A&R projects that will require
NIH funding of more than $500,000 are subject to the review, approval
and documentation requirements included or referenced in this
section for construction grants.