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ARCHIVED - NIH Grants Policy Statement (10/03)


NIH Grants Policy Statement
(12/03)

Part II: Terms and Conditions of NIH Grant Awards
Subpart B: Terms and Conditions for Specific Types of Grants, Grantees, and Activities -- File 1 of 5


Subpart B: Terms and Conditions for Specific Types of Grants, Grantees, and Activities

This subpart includes terms and conditions that vary from, are in addition to, elaborate on, or highlight the standard requirements and terms and conditions in Subpart A of this part because of the type of grant, grantee, or grant-supported activity. Each section of this subpart specifies how the coverage relates to that in Subpart A and must be used in conjunction with Subpart A to determine all of the applicable terms and conditions of a covered type of activity, grantee, or award. Cross-references in this subpart to other sections within this subpart are specifically noted; otherwise the cross-reference is to the cited section in Subpart A.

This subpart contains the following sections:

l      Construction grants, including major A&R activities under grants with specific statutory authority for construction or modernization activities (this section also includes requirements for specified A&R activities under nonconstruction grants)

l      Individual fellowships and institutional research training grants (also termed “fellowships” and “training grants”) under the Kirschstein-NRSA program

l      Modular applications and awards

l      Conference grants

l      Consortium agreements

l      Grants to foreign institutions, international organizations, and domestic grants with a foreign component

l      Grants to Federal institutions and payments to (or on behalf of) Federal employees under grants

l      Grants to for-profit organizations

l      Research patient care costs.

CONSTRUCTION GRANTS

General

The following requirements apply to NIH construction grants and major A&R activities under grants with statutory construction or modernization authority (hereafter, “construction grants”) and, as specified, to A&R projects under nonconstruction grants. Construction grants are awarded under the C06 activity code or support mechanism.

Except as indicated in this section, these requirements apply to construction grants in lieu of the requirements in Subpart A of this part. Applicants and grantees also should refer to the construction grant program regulations (42 CFR Part 52b), 45 CFR Part 74 or 92, and any applicable IC guidance. Any questions concerning the applicability of particular requirements or policies should be directed to the GMO or other official designated on the NGA.

This section uses the following definitions:

l      Construction. Construction of new buildings or the modernization of, or completion of shell space in, existing buildings (including the installation of fixed equipment, but excluding the cost of land and off-site improvements).

l      Modernization. Alteration, renovation, remodeling, improvement, expansion, and repair of existing buildings and the provision of equipment necessary to make a building suitable for use by a particular program.

Eligibility

In addition to any program-specific eligibility criteria, eligible applicants for construction grants must be public or private non-profit entities and must be located in the United States or in U.S. territories or possessions. For-profit organizations and foreign organizations are not eligible to receive construction grants.

Review and Approval

Construction grant applications are subject to peer review. Review criteria and NIH selection factors are as follows:

l      Scientific merit of the research program activities that will be carried out in the proposed facility

l      NIH programmatic relevance

l      Research and financial need for the project

l      Scientific or professional standing or reputation of the applicant and of its existing or proposed officers and research staff

l      Relationship to the applicant’s overall research programs and impact on relevant research programs and facilities in the geographic area and nationwide

l      Availability, by affiliation or other association, of other scientific or health personnel and facilities for carrying out the proposed research program, including, when warranted, the adequacy of a biohazard control and containment program

l      Project cost and design.

Public Policy Requirements and Objectives

In addition to the public policy requirements and objectives specified in Subpart A, construction grants are subject to the following public policy requirements. Questions about whether a particular requirement applies to A&R activities under nonconstruction grants should be directed to the GMO. Grantees receiving construction grants also must require contractors and subcontractors providing construction services to comply with certain Federal labor standards. These labor standards are discussed in “Equal Employment Opportunity, Labor Standards, and Other Contract Requirements” in this section.

The National Environmental Policy Act of 1969

NEPA, as amended (Public Law 91-190), establishes national policy goals and procedures to protect and enhance the environment, including protection against natural disasters. NEPA requires all Federal agencies to consider the probable environmental consequences of any major Federal activity, including grant-supported activities. To comply with NEPA for its grant-supported activities, NIH requires the environmental aspects of construction grants (and certain nonconstruction projects as specified by NIH) to be reviewed and evaluated by NIH technical staff before final action on the application. With respect to earthquakes, structures will be evaluated in accordance with the lateral forces provisions of the Uniform Building Code.

If NEPA applies, the application must be accompanied by the applicant’s own separately bound environmental analysis to facilitate review and evaluation for environmental concerns before approval or other action on the application. An environmental analysis means a written review that indicates the expected environmental effects resulting from the proposed action, defines the current and future implications of those effects, and lists any proposed actions or safeguards to avoid or reduce any negative environmental effects. If NIH has not indicated in the RFA that NEPA applies, no environmental analysis is necessary, unless, in an unusual situation, the applicant anticipates a significant environmental consequence or, following receipt of an application, an official of the NIH awarding office indicates the need for an environmental analysis. In those cases, an environmental analysis shall be provided with the application or as requested by NIH.

Public Disclosure

Section 102 of NEPA and EO 11514 (March 5, 1970) provide for public comment and participation in the environmental impact review process. Applicants are required to publicly disclose the project in a newspaper or other publicly available medium and to describe its environmental impact concurrent with notification to the SPOC (see “Intergovernmental Review under Executive Order 12372” in this section). An example of a suitable disclosure statement follows:

Notice is hereby given that the Uptown Medical School proposes to construct additional space, partially utilizing Federal funds. The proposed construction project is the addition of 2,700 square feet connected to the existing Allen Building, which is located at 5333 Main Street, Downtown, Ohio.

The Medical School has evaluated the environmental and community impact of the proposed construction. There will be construction noise and increased construction traffic during the construction period. No significant permanent environmental impacts are foreseen. All building permits and zoning approvals have been obtained. In accordance with Executive Order 11514 (March 5, 1970), which implements the National Environmental Policy Act of 1969, as amended, any individual or group may comment on, or request information concerning, the environmental implications of the proposed project. Communications should be addressed to the Office of Planning, Uptown Medical School, and must be received by (date). The Federal grant application may be reviewed at the Office of the Dean, School of Medicine, 5333 Main Street, during normal working hours.

Flood Insurance

The Flood Disaster Protection Act of 1973, as amended (Public Law 93-234), provides that no Federal financial assistance to acquire, modernize, or construct property may be provided in identified flood-prone communities in the United States, unless the community participates in the National Flood Insurance Program and flood insurance is purchased within 1 year of the identification. The flood insurance purchase requirement applies to both public and private applicants for NIH support. Lists of flood-prone areas that are eligible for flood insurance are published in the Federal Register by FEMA.

Historic Properties and Archeological Sites

Under the provisions of the National Historic Preservation Act, as amended, and the Archeological and Historical Preservation Act of 1960, as amended, the Secretary of the Interior has compiled a National Register of Historic Places—sites and buildings of significant importance to U.S. history.[15] The statutes require that, before approval of a construction grant application (or other applications as specified by NIH), NIH take into account the effect on these sites of the proposed construction (or other) project. The applicant must determine whether activities using NIH financial assistance will affect a property listed in the National Register. If a designated historic property will be affected, the applicant must obtain clearance from the appropriate State Historic Preservation Office before submitting the application. Failure to obtain this clearance will delay NIH action on an application. The State Historic Preservation Liaison Officer or the National Trust for Historic Preservation may be contacted for additional details.

Intergovernmental Review under Executive Order 12372

EO 12372, Intergovernmental Review of Federal Programs (July 14, 1982), as amended, requires consultation with State and local officials on certain proposed Federal assistance. NIH construction grants are subject to these requirements, as implemented by 45 CFR Part 100, Intergovernmental Review of Department of Health and Human Services Programs and Activities. Applicants (other than federally recognized Indian tribal governments) should contact their SPOC as early as possible to alert the SPOC to the forthcoming application and to obtain necessary instructions on the State process (see http://www.whitehouse.gov/omb/grants/spoc.html for a list of SPOCs). The SPOC is given 60 days to review the application. To accommodate this time frame and the NIH review process, an applicant must provide a copy of the application to the SPOC no later than the time the application is submitted to NIH. SPOC comments must be submitted to NIH with the application, or the application must indicate the date on which the application was provided to the SPOC for review. If SPOC comments are not submitted with the application, the applicant must provide them upon receipt and may include its reaction to the comments, or it must notify NIH that it did not receive any SPOC response.

Metric System

Consistent with EO 12770 (July 25, 1991), Metric Usage in Federal Government Programs, all construction projects supported by NIH grant funds shall be designed using the metric system.

Relocation Assistance and Real Property Acquisition

The Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (the Uniform Relocation Act), 42 U.S.C. 4601 et seq., applies to all programs or projects undertaken by Federal agencies or with Federal financial assistance that cause the displacement of any person.

The HHS requirements for complying with the Uniform Relocation Act are set forth in 49 CFR Part 24. Those regulations provide uniform policies and procedures for the acquisition of real property, including acquisition by grantees, and require that displaced people be treated fairly and equitably. They encourage acquiring entities to negotiate promptly and amicably with property owners so property owners’ interests are protected and litigation can be avoided.

Other Public Policy Requirements

Recipients of NIH construction grants must comply with, or require their contractors to comply with, the requirements set forth in the following:

l      Clean Air Act, 42 U.S.C. 7401 et seq., and Federal Water Pollution Control Act (Clean Water Act), as amended, 33 U.S.C. 1251 et seq., for contracts exceeding $100,000

l      Uneconomical, hazardous, or unnecessary use of flood plains for construction—EO 11988 (May 24, 1977)

l      Provisions for potable water supply—Safe Drinking Water Act (Title XIV of the Public Health Service Act, as amended)

l      Conservation of petroleum and natural gas—EO 12185 (December 17, 1979)

Design Requirements for NIH-Assisted Construction[16]

Grantees may not advertise for bids or negotiate a contract for construction or A&R activities exceeding $500,000 in direct costs until working drawings and specifications have been approved by the designated NIH official. One purpose of the NIH review is to apply program-specific design standards to the working drawings and specifications to ensure that program needs are met and the facility will suitably accommodate the activities to be carried out there. In addition, NIH will determine whether the final plans and specifications conform to the minimum standards of construction and equipment specified in 42 CFR Part 52b, in the NIH Design Policy and Guidelines issued by NIH’s DES, and in the documents cited in this subsection. (The NIH Design Policy and Guidelines are available at http://orf.od.nih.gov/PoliciesAndGuidelines/BiomedicalandAnimalResearchFacilitiesDesignPoliciesandGuidelines/policy-index.htm.) These standards may be modified by DES. The grantee will be subject to the standards in effect at the time of design or construction, as appropriate. NIH will monitor compliance during the project’s design phase.

Where State or local codes are proposed as a basis for facility design in lieu of the NIH design requirements, a prior determination must be made by NIH that the specific State or local code is equivalent to, or exceeds, NIH requirements. If State and local codes or requirements exceed the design requirements set forth in NIH regulations or incorporated in policy guidance, the more stringent requirements will apply.

Elimination of Architectural Barriers to the Physically Handicapped

The Architectural Barriers Act of 1968, as amended, the Federal Property Management Regulations 101-19.6 (41 CFR 101-19.6), and the Uniform Federal Accessibility Standards issued by the General Services Administration (41 CFR 101-19.6, Appendix A) set forth requirements to make facilities accessible to, and usable by, the physically handicapped and include minimum design standards. All new facilities constructed with NIH grant support must comply with these requirements. These minimum standards must be included in the specifications for any NIH-funded new construction unless the grantee proposes to substitute standards that meet or exceed these standards. Where NIH assistance is provided for alteration or renovation (including modernization and expansion) of existing facilities, the altered facility (or part of the facility) must comply, including use of the minimum standards in the specifications. The grantee will be responsible for conducting inspections to ensure compliance with these standards by any contractor performing construction services under the grant. Also see “Public Policy Requirements and Objectives—Civil Rights—Rehabilitation Act of 1973.”

Seismic Safety for Federally Assisted Construction

The Earthquake Hazards Reduction Act of 1977, as amended (Public Law 95-124), and EO 12699, Seismic Safety of Federal and Federally Assisted or Regulated New Building Construction (January 5, 1990) apply to NIH-assisted construction. The EO requires that new federally assisted or regulated buildings be designed and constructed using appropriate seismic standards. Where necessary, special structural and other features to protect life and minimize damage to facilities from tornadoes also may be required.

The model codes listed in Exhibit 7 provide a level of seismic safety considered appropriate for implementing EO 12699 and apply to all federally assisted construction in the applicable geographic location. Also acceptable are State, county, or local jurisdictional building ordinances that adopt and enforce these model codes in their entirety or without material revisions that would reduce the level of seismic safety.

Additional Design Requirements

Exhibit 7 lists additional NIH design requirements and their sources.


Exhibit 7. Design Requirements for NIH-Assisted Construction

Requirement

Notes (if appropriate) and source

Model Codes for Seismic Safety

Uniform Building Code

International Conference of Building Officials
5360 Workman Mill Road
Whittier, CA 90601-2298

Telephone: 562-699-0541 or 800-284-4406
Website: http://www.iccsafe.org/e/category.html  (Online Product Store)

National Building Code (1999) and National Fire Prevention Code (1999)

Building Officials and Code Administrators Intl., Inc.
4051 West Fossmoor Road
Country Club Hills, IL 60478

Telephone: 800-214-4321, ext. 371
Website: http://www.bocai.org/boca-es/

Southern Building Code Congress Standard Building Code (1999),

Southern Building Code Congress International
900 Montclair Road
Birmingham, AL 35213-1206

Telephone: 205-591-1853
Website: www.sbcci.org (Order & Price List)

Recommended Lateral Force Requirements/Commentary (1999), Structural Engineers Association of California

International Conference of Building Officials
5360 Workman Mill Road
Whittier, CA 90601-2298

Telephone: 562-699-0541 or 800-284-4406
Website: http://www.iccsafe.org/e/category.html (Online Product Store)

Other Design Requirements

Guidelines for Design and Construction of Hospital and Healthcare Facilities (2001)

AIA, Academy of Architecture for Health

Telephone: 202-626-7541 or 800-242-3837 (press 4)
Website: http://www.aia.org/publications/

American Society of Heating, Refrigeration, and Air Conditioning Engineers Handbook—HVAC Applications (1999)

ASHRAE

Website: http://www.ashrae.org.

Life Safety Code (NFPA Publication 101 and supplements)

NFPA
1 Batterymarch Park
Quincy, MA 02269-9101

Telephone: 617-770-3000 or 800-344-3555
Website: http://www.nfpa.org/Codes/index.asp.

Standard on Fire Protection for Laboratories Using Chemicals (NFPA Publication 45)

NFPA
1 Batterymarch Park
Quincy, MA 02269-9101

Telephone: 617-770-3000 or 800-344-3555
Website: http://www.nfpa.org/Codes/index.asp

Prudent Practices for Safety in Laboratories (1995)

National Research Council, National Academy Press
ISBN 0-309-05229-7

Website: http://books.nap.edu/catalog/4911.html.

National Sanitation Foundation Standard 49 for Class II (Laminar Flow) Biohazard Cabinetry (2002)

National Sanitation Foundation
327 Jones Drive
Ann Arbor, MI 48105

Telephone: 800-699-9277
Website: http://www.techstreet.com/nsfgate.html

Standard Plumbing Code (2000)

Southern Building Code Congress International
900 Montclair Road
Birmingham, AL 35213-1206

Telephone: 205-591-1853
Website: http://www.sbcci.org (Order & Price List)

Industrial Ventilation: A Manual of Recommended Practice (2001)

American Conference of Government Industrial Hygienists
1330 Kemper Meadow Drive
Cincinnati, OH 45240-1634

Telephone: 513-742-2020
Website: http://www.acgih.org/Products/

Health Care Facilities Handbook (2002)

NFPA
1 Batterymarch Park
Quincy, MA 02269-9101

Telephone: 617-770-3000 or 800-344-3555
Website: http://www.nfpa.org/Codes/index.asp

Standard for Healthcare Facilities (NFPA Publication 99).

NFPA
1 Batterymarch Park
Quincy, MA 02269-9101

Telephone: 617-770-3000 or 800-344-3555
Website: http://www.nfpa.org/Codes/index.asp

National Electric Code (NFPA
Publication 70)

NFPA
1 Batterymarch Park
Quincy, MA 02269-9101

Telephone: 617-770-3000 or 800-344-3555
Website: http://www.nfpa.org/Codes/index.asp

Laboratory Ventilation Codes

American Industrial Hygiene Association
2700 Prosperity Avenue, Suite 250
Fairfax, VA 22031

Telephone: 703-849-8888
Fax: 703-207-3561
Website: http://www.aiha.org/PublicationsAdvertising/
html/pubadhome.htm

 

Funding

Construction grants usually involve a single award, covering more than 1 year, made on the basis of an application for the entire construction project. The project period system of funding normally is not used for construction grants.

Matching

NIH construction grants generally require the grantee to share in the costs of the project. This requirement, if applicable, is stated as a matching percentage; the grantee’s match is usually at least 50 percent of the total allowable project costs. Any required non-Federal participation may be in the form of allowable costs incurred by the grantee or a contractor under the grant. Unless required by statute or regulation, NIH generally does not allow grantees to use the value of third-party in-kind contributions as a source of matching. Matching costs and in-kind contributions (if authorized) must meet the allowability and documentation requirements of 45 CFR 74.23 or 92.24, as applicable. Costs claimed as matching also are subject to the requirements of the NIHGPS which apply to the expenditure of NIH funds.

The source and amount of funds proposed by an applicant to meet a matching requirement must be identified in the application. The applicant will be required to demonstrate that the funds are committed or available before award. This may take the form of an assurance as specified by the NIH awarding office. The amount of NIH (Federal) funds awarded, combined with the non-Federal share, will constitute the total approved budget as shown in the NGA. The prior-approval and other dollar thresholds contained in this section are determined on the basis of the total approved budget unless otherwise specified.

Allowable and Unallowable Costs and Activities

Construction activity is allowable only when program legislation includes specific authority for construction, modernization, or major alteration and renovation of facilities and when NIH specifically authorizes such costs. The following lists indicate types of costs and activities generally allowable and unallowable under NIH construction grants. The lists are not all-inclusive. Program guidelines and other terms and conditions of the award should be consulted for the specific costs allowable under a particular program or grant.

Allowable costs and activities include the following:

l      Acquisition and installation of fixed equipment.

l      A&R. Under programs that have statutory A&R, modernization, or construction grant authority, the costs of adapting any of the following interior building features to the needs of the grant-supported activity are allowable:

Ø      Physical characteristics of space, such as interior dimensions, surfaces, and finishes

Ø      Internal environment, such as heating, ventilation, humidity, and acoustics

Ø      Utility services, such as plumbing, electricity, gas, vacuum, or other laboratory piping

Ø      Completion of unfinished shell space to make it suitable for purposes other than human occupancy, such as the storage of pharmaceuticals

Ø      Fixed equipment, such as casework, fume hoods, large autoclaves, or biological safety cabinets.

A&R costs of this type associated with a building under construction or an otherwise incomplete structure may be allowed if

Ø      the space is to be adapted to particular program needs,

Ø      it is cost-effective to perform the work while the building is being constructed or the structure is being completed, and

Ø      A&R costs are limited to the difference between the cost of completing the interior space for general use and the cost of adapting the space and utilities to meet specific program requirements.

When the grantee’s own construction and maintenance staffs are used in carrying out the A&R (i.e., force account), the associated costs are allowable provided the grantee can document that force account is less expensive than if the project were competitively bid and can substantiate all costs with appropriate receipts for the purchase of materials and certified pay records for the labor involved. This requires prior approval by the NIH awarding office.

l      Architectural and engineering services. Also see “Pre-Award Costs” in this subsection.

l      Bid advertising.

l      Bid guarantees and performance and payment bonds. Bid guarantees and performance and payment bonds are allowable as provided in 45 CFR 74.48 or 92.36(h).

l      Contingency fund. Applicants for construction grants may include a project contingency fund in initial cost estimates to provide for unanticipated charges. These funds will be limited to 5 percent of construction and equipment costs before bids are received and must be reduced to 2 percent after a construction contract has been awarded.

l      Filing fees for recording the NFI. See “Real Property Management Standards—Notice of Federal Interest” in this section.

l      Inspection fees.

l      Insurance. Costs of title insurance, physical destruction insurance, and liability insurance are generally allowable. Physical destruction and liability insurance are usually treated as F&A costs but may be treated as direct costs in accordance with the established policy of the grantee, consistently applied regardless of the source of funds. Title insurance, if required, may be charged to the grant in proportion to the amount of NIH participation in the property (see “Real Property Management Standards—Insurance Requirements” in this section).

l      Legal fees. Legal fees related to obtaining a legal opinion regarding title to a site.

l      Pre-award costs. Costs incurred before an award for architect’s fees and consultant’s fees necessary to the planning and design of the project are allowable if the project is subsequently approved and funded.

l      Project management.

l      Relocation expenses.

l      Sidewalks necessary for use of facility.

l      Site survey and soil investigation.

l      Site clearance. Site clearance costs are allowable as long as they are reflected in the bid.

Unallowable costs and activities include the following:

l      Bonus payments to contractors. Bonus payments to contractors, including those to guaranteed maximum price contractors, are unallowable.

l      Construction of shell space designed for completion at a future date.

l      Consultant fees not related to actual construction.

l      Damage judgment suits.

l      Equipment purchased through a conditional sales contract.

l      F&A costs.

l      Fund-raising expenses.

l      Land acquisition.

l      Legal services not related to site acquisition.

l      Movable equipment.

l      Off-site improvements. Off-site improvements such as parking lots are not allowable.

Procurement Requirements for Construction Services
under NIH Construction
Grants

General

Construction activity usually is carried out through one or more contracts under the grant. Therefore, the circumstances of the procurement are critical to the successful completion of the grant-supported project. All construction work must be procured by the methods described in 45 CFR 74.40 through 74.48 or in 92.36, as applicable. Normally, this means a prime construction contract is awarded following a competitive sealed bidding process (previously “formal advertising” in Federal contracting) resulting in a lump-sum, fixed-price contract. NIH may authorize other procurement methods and other types of contracts when sealed bidding or a fully competitive negotiated process is impractical. The specific requirements for contracting for construction management services and design-build services are described below.

In general, grantees must do the following:

l      Ensure that all qualified contractors are given an opportunity to bid and have their bids fairly considered.

l      Guarantee, insofar as possible, that the contract(s) will result in the completion of a facility (ready for occupancy) that conforms to the design and specifications approved by the NIH awarding office (or any appropriate modification thereof with NIH awarding office approval, as required) at a cost within the grantee’s ability to pay. (NIH expects that the applicant holds (or will hold) title to the property on which the grant-supported construction is performed.)

l      Obtain NIH awarding office approval of plans and specifications both before soliciting bids or proposals and before awarding a prime construction contract. The procurement methods to be employed must be reviewed and approved by the NIH awarding office. The grantee is responsible for ensuring that the project is constructed to completion in accordance with the approved plans or specifications and for obtaining necessary approvals for changes as specified in this section.

l      Take adequate steps to ensure that the total cost of construction—i.e., the total cost of all contracts awarded under a project—will be within the amount of funds available for the project. This can be accomplished by accurate price estimating and/or the use of bid alternates. A precise description of the scope of work, specifications, materials, and construction techniques in the invitation for bids will facilitate accurate cost estimating by both the bidder and the grantee’s professional representatives. The description of work becomes especially important when multiple contracts will be let in support of the same project, because each contractor must know exactly what is involved in the portion(s) of the job on which it is bidding.

l      In invitations for bids, 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.

Where more than one NIH or HHS program will support a construction project, or where the NIH-supported project is less than the entire facility or construction to be bid, the grantee must obtain bids that provide, to the maximum extent possible, the costs for that portion of the total job that will be financed by NIH funds and any required grantee matching. This may be done by

l      showing the cost for each building or site in the project, if it consists of more than one building or construction site and can be divided for bidding and construction purposes, or

l      identifying, to the extent possible, or prorating the applicable costs when the project is a single site or contains common space and cannot be divided for bidding and construction purposes.

Where practical, the grantee may request, in the invitation for bids, alternates to the base bid that are keyed to specified and explicitly stated changes in the project scope, materials, or construction techniques. Alternates may be used when it is anticipated that the amount of the low bid will exceed the amount of funds available to the grantee to award a contract, and the grantee must make adjustments to the project to reduce costs in order to award a contract within the funds available. “Add” alternates will make it possible to incorporate necessary features that otherwise would not have been included in the project. Alternates that are selected may be included in determining the low aggregate bid. The grantee must identify, in its bid schedule, whether the low bid will be determined inclusive or exclusive of alternates. If inclusive, then alternates must be awarded in order, up to the amount of funds available. For example, Alternate 1 will be awarded first, Alternate 2 second, Alternate 3 third, etc. No alternate may be awarded out of sequence. If all bids exceed the funds available even after the steps described above have been taken, the grantee may do the following:

l      Decline to award a contract and instead issue a revised invitation for bids containing changes in specifications or other factors affecting price that have been approved by the NIH awarding office.

l      Negotiate with the low bidder (this is an exception to sealed bidding) or, if that bidder should refuse, in writing, to negotiate, negotiate with the next lowest bidder. Any changes in design and specifications resulting from such negotiations must be approved by the NIH awarding office. If efforts to negotiate are unsuccessful, all bids must be canceled, and the project rebid.

l      Obtain approval from the NIH awarding office to authorize a construction management firm already employed by the grantee to perform the construction work. The price for the work involved must not exceed the line-item prices (GMP) stipulated in the construction management contract as approved by the NIH awarding office (see “Construction Management Services” in this section for requirements for a construction management agreement).

l      Enter into a design-build contract (see “Design-Build Services” in this section) for a functionally equivalent facility.

Construction Management Services

Construction management services are management services generally procured through negotiation rather than by sealed bidding. These services include technical consultation during the design stage of a project and, during the construction phase, organization and direction of construction activities. In the negotiated procurement process, the RFP must address both the technical qualifications of the offeror (possibly 75 percent of the evaluated score) and the business (cost) aspects of the proposal (possibly 25 percent of the evaluated score). The award must be based on a combination of both the technical and business evaluations. The basis of the award, i.e., whether cost or technical qualifications will weigh more heavily in the award decision, must be stated in the RFP. The services of construction managers may be procured by sealed bidding if State or local governments prohibit the procurement of construction management services through negotiation.

Contracting for construction work on a project covered by a construction management agreement is subject to all of the requirements otherwise applicable to the solicitation and award of contracts, except that bids may be obtained by prequalification and selective solicitation. When prequalification and selective solicitation are used, the construction manager must

l      prequalify all firms that respond to the announcement and are determined to meet the prequalification standards;

l      establish bidders lists for each of the invitations for bids, including, at least, all prequalified firms, and possibly including other known qualified firms;

l      solicit, in writing, bids from all firms on the bidders list;

l      consider bids from any contractor who requests permission to bid and who is determined by the grantee to meet the prequalification standards; and

l      prepare a bid abstract.

The GMP method may not be used to acquire construction management services under NIH grants unless the grantee obtains NIH prior written approval. If this method is used, the grantee must comply with the following requirements:

l      The construction management contract must place total financial responsibility on the construction manager to complete construction of the project at or below the GMP. If the contract exceeds $100,000, the construction manager will be required to comply with bid guarantee and bonding requirements as specified in 45 CFR 74.48(c) or 92.36(h).

l      The GMP must be obtained from the construction manager before NIH will authorize the solicitation and award of the first construction contract. This requirement applies whether or not phased construction techniques are employed. Each portion of the work for which a separate contract is expected to be let shall be separately priced as an individual line item in the GMP contract.

The grantee must transmit all GMP bids to the GMO, with its recommendation for award to the lowest responsive, responsible bidder.

After the award of a GMP contract, the following applies:

l      All GMP subcontracts must be bid on the open market, and there must be at least three bidders to allow for an award. If three bids cannot be obtained, the grantee must submit, in writing, to the GMO or other designated official, a detailed explanation of why the GMP contractor is unable to comply, along with supporting documentation for NIH consideration and approval or other action.

l      All GMP bids must be completely itemized, by trade, to include a separation of labor and materials, all markups, and no contingency other than that which will cover change orders as approved by the grantee.

l      All costs lower than the GMP line item bid as approved by the NIH awarding office shall be refunded or credited to the grantee by the contractor and by the grantee to NIH. All costs in excess of the GMP after all items have been bid are the responsibility of the GMP contractor.

l      All subcontract prices must be approved by the NIH awarding office before making individual awards. The awards shall be made to the lowest-priced responsible, responsive bidders.

If a contract with a GMP clause was awarded to a construction management firm before the NIH grant award, the firm’s subcontractors must compete in an open competition for the subcontract work under the GMP contract. The GMP contractor must make available to the public all pertinent information that could influence bids and interpretation of the design intent.

Design-Build Services

In design-build contracting, construction firms respond to an RFP by submitting building designs to meet the grantee’s performance requirements within a GMP (see GMP requirements under “Construction Management Services” in this section) that covers all required architectural, engineering, and construction services. The design-build firm must be selected in a manner that allows maximum feasible competition. The selection process must include public announcement of the RFP, 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:

l      Technical considerations and cost may be treated as competitive factors.

l      The grantee may negotiate cost or design with one or more firms.

On all design-build projects, the grantee must ensure a firm total cost by including in the 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 resulting contract documents (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 EO 11246 (September 24, 1965), as amended, as implemented in
41 CFR Part 60-1 by OFCCP, DoL. The grantee is required to include the “Equal Opportunity Clause” at 41 CFR 60-1.4(b) in any construction contract 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 in specified geographical areas that will exceed $10,000. These requirements are specified in the “Notice of Requirement for Affirmative Action to Ensure Equal Employment Opportunity (EO 11246)” and the “Standard Federal Equal Employment Opportunity Construction Contract Specifications (EO 11246).”

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 that will exceed $10,000.

Further information about these requirements and the full text of these regulations are available at http://www.dol.gov/esa/ofcp_org.htm.

Preservation of Open Competition and Government Neutrality
Toward Government Contractors’ Labor Relations on Federal
and Federally Funded Construction Projects

EO 13202, Preservation of Open Competition and Government Neutrality Towards Government Contractors’ Labor Relations on Federal and Federally Funded Construction Projects (February 17, 2001), as amended by EO 13208 (April 6, 2001), requires executive agencies issuing grants, providing Federal assistance, or entering into cooperative agreements for construction projects (including major and minor A&R) to ensure that bid specifications, project agreements, or other controlling documents for construction contracts awarded by recipients of grants, cooperative agreements, or other financial assistance do not do the following:

l      Require bidders, offerors, contractors, or subcontractors, or prohibit them, from entering into or adhering to agreements with one or more labor organizations, on the same or other related construction projects.

l      Otherwise discriminate against bidders, offerors, contractors, or subcontractors for becoming, refusing to become, or remaining signatories, or otherwise adhering to agreements with one or more labor organizations, on the same or other related construction projects.

Nonsegregated Facilities

Pursuant to 41 CFR 60-1.8, for any contract that will exceed $10,000, the grantee must require each prospective construction contractor to submit a certification that the contractor

l      does not, and will not, maintain any facilities it provides for its employees in a segregated manner;

l      does not or will not permit its employees to perform their services at any location, under the contractor’s control, where segregated facilities are maintained; and

l      will obtain a similar certification before awarding any covered subcontract.

Labor Standards

Contract Work Hours and Safety Standards Act

Construction contractors and subcontractors under NIH grants with contracts or subcontracts exceeding $100,000 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 Federal 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, pursuant to standards issued by the Secretary of Labor, 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. Violation of these requirements may be cause for debarment from future Federal contracts or financial assistance.

Liquidated Damages

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, 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 before solicitation. Where damages are assessed, any amounts paid belong to the grantee.

Disposition of Unclaimed Wages

During or after the period of performance of an NIH-assisted construction contract, if it is discovered 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 2 years, or longer if required by State or local law, following the completion of the contract. 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. If the project was funded by more than one NIH or HHS program at differing rates, the refund should be based on 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 while the account is maintained, a complete report must be made to the GMO when the account is closed.

Administrative Requirements

Prior-Approval Requirements

Construction Grants

Grantees must obtain written prior approval from the GMO for grantee-initiated project or budget changes under the following circumstances:

l      A revision that would result in a change in scope of the project, including proposed modifications that would materially alter the costs of the project, space utilization, or financial layout, and associated changes in the previously approved solicitation or contract

l      A revision that would increase the amount of Federal funds needed to complete the project

l      Any other applicable change as specified in “Administrative Requirements—Changes in Project and Budget.”

The request for approval must include sufficient information to allow NIH review of the circumstances and need for the proposed change. After receipt of written prior approval from the GMO, the grantee may make or authorize the approved modifications of the construction contract. Other less substantive modifications to construction contracts may be made 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—Monitoring—Record Retention and Access”).

Alteration and Renovation Projects under Nonconstruction Grants

Two copies of each of the following documents must be submitted with each request for approval of minor A&R costs greater than $300,000, but not more than $500,000 (whether proposed in the application or as a post-award rebudgeting request):

l      Single-line drawing of the existing space and proposed alterations.

l      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 must 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:

Ø      General information

Ø      Description of the functions to be performed in the space

Ø      Space schedule (detailed description of floor space)

Ø      List of fixed equipment proposed for the facility

Ø      Cost estimate (see sample format in Exhibit 8)

Ø      Special design problems

Ø      Description of the existing and proposed utility systems for the modified space

Ø      Description of plans to provide accessibility for the physically handicapped

Ø      Provisions for meeting the requirements of the Life Safety Code

Ø      Length of the property lease if the space is rented

Ø      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 also must be provided:

l      Detailed justification for the need to perform the work before the building is completed

l      Cost comparison between doing the work before and after the building is completed

l      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.

Exhibit 8. Sample Format for A&R Cost Estimate

Estimate the costs in which the Federal government is requested to participate:

Cost category

Amount

A&R costs (to Federal government)

 

Demolition

$

General alteration and renovation (carpentry, masonry, painting)

$

Plumbing

$

Heating, ventilation, and air conditioning

$

Electrical

$

Architect’s and engineer’s fees

$

Other costs (specify)

$

Total A&R costs

$

Fixed equipment costs

$

List sources and amounts of funds for total A&R project

NIH sources and amounts

Sources and amounts other than NIH

Other Information

Total gross square meters/feet of floor area in A&R proposal

 

Estimated cost per gross square meter/foot excluding fixed equipment

 

Total net square meters/feet of floor area in A&R proposal

 

Estimated cost per net square meter/foot, excluding fixed equipment

 

 

Real Property Management Standards

General

Real property constructed under an NIH grant-supported project is subject to the requirements of 42 CFR Part 52b and the provisions of 45 CFR 74.30 through 74.32 and 74.37 or 92.31, as applicable, regarding use, transfer of title, and disposition, unless alternate requirements are specified in the governing statute. Statutory provisions may specify alternate requirements for the length of the grantee’s accountability obligations, the Federal right of recovery, or waivers. For example, the governing statute for a construction grant program may contain usage and disposition requirements that are in addition to or different from the usage and disposition requirements of the governing regulations. To the extent statutory provisions differ from the requirements of 42 CFR Part 52b and/or 45 CFR Part 74 or 92, including those described in this subsection, the statutory provisions, as reflected in the terms and conditions of the award, apply.

Real property constructed or renovated with NIH grant support may not be conveyed, transferred, assigned, mortgaged, leased, or in any other manner encumbered by the grantee, except as expressly authorized in writing by NIH. If the grantee defaults in any way on a mortgage, the grantee shall immediately notify the GMO by telephone and in writing. If the mortgagor intends to foreclose, the grantee must notify the GMO in writing at least 30 days before the foreclosure action is initiated.

The mortgage agreement must specifically allow, in the case of default, that NIH or its designee may assume the role of mortgagor and continue to make payments. If NIH (or its designee) chooses not to assume the role of mortgagor in the case of default, the grantee shall pay NIH an amount equal to the share of the sales proceeds otherwise due the grantee multiplied by the NIH share of the property.

Any NIH assignment of the property and mortgage responsibilities to any party other than NIH shall be subject to prior approval of the mortgagor.

Use and Disposition

NIH construction awards generally require that a facility be used for biomedical or behavioral research as long as needed for that purpose. NIH defines this period as 20 years from the date of beneficial occupancy unless another period is prescribed by statute. During that time, the grantee shall comply with applicable disposition requirements. If, during the required usage period, the facility is no longer used for the original intended purpose and NIH did not provide prior approval for an alternate use, NIH may recover its share. NIH will monitor grantee compliance with these requirements for the duration of the required usage period. After the required usage period, the grantee has no further accountability to NIH concerning the use of the property or any sales proceeds.

For disposition of property acquired on an amortized acquisition basis, the formulas in 45 CFR 74.32 and 92.31 do not apply in determining the Federal share. In cases of amortized acquisition, the Federal share will be determined by multiplying the amount of mortgage principal already repaid at the time of disposition by the average Federal participation (taken from the FSR) plus the increase in value over the purchase price multiplied by the average Federal participation plus the Federal participation in the down payment. The computation of the Federal share of real property acquired with long-term debt financing must be computed for each year of grant support in which Federal funds are used to meet all or a portion of the down payment and/or principal on the mortgage.

Real Estate Appraisals

If a real estate transaction funded in whole or in part by NIH requires the use of a real estate appraisal (including, but not limited, to appraisals to determine the Federal share of real property and appraisals to determine required insurance levels), the appraisal must be performed by appraisers certified or licensed by the applicable State in accordance with the requirements established by Title XI of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989, as amended (Public Law 101-73).

Notice of Federal Interest

To protect the Federal interest in real property that has been constructed or has undergone major renovation with NIH grant funds, grantees shall record a NFI in the appropriate official records of the jurisdiction in which the property is located. The time of recordation shall be when construction or renovation begins. Fees charged for recording the NFI may be charged to the grant (see “Allowable and Unallowable Costs and Activities” in this section).


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