HomeMy WebLinkAboutAgenda - 12-09-2003-8mORANGE COUNTY
BOARD OF COMMISSIONERS
ACTION AGENDA ITEM ABSTRACT
Meeting Date: December 9, 2003
Action Agenda
Item No. ~- rn
SUBJECT: Section 8
Based Voucher
DEPARTMENT: Housing/Comm. Development
PUBLIC HEARING: (Y/N) No
ATTACHMENT(S):
HUD Letter (12/05/2003)
Draft Agreement to Enter into Housing
Assistance Payments Contract, Parts I
& II (under separate cover)
INFORMATION CONTACT:
Tara L. Fikes, ext 2490
TELEPHONE NUMBERS:
Hillsborough 732-8181
Chapel Hill 968-4501
Durham 688-7331
Mebane 336-227-2031
PURPOSE: To approve the execution of the Agreement to Enter into Housing Assistance
Payments Contract, Parts I and II, with the Club Nova Apartments, LLC for the proposed Club
Nova Apartments in Carrboro.
BACKGROUND: The Housing and Community Development Department administers the
Section 8 Housing Voucher Program for Orange County. This program provides rent subsidies
to low income families renting standard property throughout the County. Funding for the
program comes from the U.S. Department of Housing and Urban Development (HUD).
Currently, the program has budget authority to provide rent subsidies for approximately 623
families. The total number of families served by the program has not changed over the last five
years due to the lack of growth in the national program.
In November 2002, in anticipation of the potential future development of rental housing
complexes for families and individuals with special needs, County staff recommended and the
Board of County Commissioners approved the establishment of a policy for a Project Based
Section 8 Program. A project-based program will provide for the allocation of Section 8
assistance tc new dwelling units serving persons with disabilities with incomes less than 50% of
the median income.. This is in contrast to the current tenant-based program that allows low-
incame persons to receive rental subsidy regardless of location as long as the unit meets
Housing Quality Standards.
Subsequently, the County publicly solicited applications for project-based assistance and the
developers of the Glub Nova Apartments submitted an application in January 2003. The
application was reviewed locally and submitted to HUD Greensboro office for review and
approval in February 2003.
2
On December 5, 2QQ3, the County received notification of the approval of 24 project-based
vouchers for the proposed Club Nava Apartments (See Attached Letter). It is important to note
that the designation of existing vouchers as project-based vouchers will be done from our
existing voucher pool and does not represent a new allocation of vouchers.
Thus, in order to provide these vouchers, the County must execute an Agreement to Enter into
a Housing Assistance Payments Contract, Parts I and II, in addition to providing the HUD office
with a Cost Certification as well as a Design Certification. The developers of Club Nova have
been anxiously awaiting this decision in order to finalize the construction financing for the
project, thus work will begin immediately to satisfy HUD's requirements. County staff and the
County Attorney will be working with the project sponsor in the next thirty days to finalize the
required HUD Agreement. A copy of the form of the Agreement is attached to this abstract as
additional information.
FINANCIAL IMPACT: The program will be financed by the current Section 8 Housing Choice
Voucher Program.
RECOMMENDATION(S): The Manager recommends approval of the execution of the
Agreement to Enter into Housing Assistance Payments Contract, Parts I and II, with the Club
Nava Apartments, LLC for the proposed Club Nava Apartments in Carrboro upon the review
and approval of the County Attorney.
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U. S. Department of Housing and Urban Development
Greeneuoro Field Otflce
1500 Pinecroft Road, Suite 401
Greensboro, NC 27407-3838
www.hud,gov/IocaUgre
oEC u s too3
Ms Tara L. Pikes
Directoz
Orange County Department of
Housing and Community Development
P O HoX 8181
Hillsborough, NC 27278
Deaz Ms. Fikes:
A subsidy layering review for Club Nova Apartments to be located in Cazrboro,
North Carolina, has been completed.. Mental Health Association in North Cazolina, Inc.
(MHA/NC, Inc.) will be the managing genezal partner for the project: A1124 units
(studio/efficiency traits) will be assisted with project-based assistance.
The zeview was based upon financial documentation submitted to HUD Headquarters by
this offtce, the project owner, and Orange County Department of Housing and Conununity
Development (HA); in accordance with the Administrative Guidelines published in the Federal
Re inter on February 25, 1994; and in accordance with the Revisions to PIIA Pzoject-}3ased
Assistance Program, Initial Gmdance published in the Federal lteRister on January 16, 2001.. As
a result of the review, we are authorizing initial contract rents of $542.00 with a $57.00 utility
allowance for these 24 units. These rents aze different from the rents in the application.
As part of the subsidy layering zeview, it was determined that ttte proposed project will
zcceive 71 cents per dollaz of total allocation in net syndication proceeds as a souzce of funds.
'T`herefore, the project was not subjected to further review pursuant to Section 102(d) of the H1T17
Reform Actor to further Section 911 review-
The Housing Authority and the owner must comply with the following provision:
Cost Certi&cation. Housing assistance payments under the HAY Contract must not be
more than necessary, based upon HUD requirements, to provide affordable housing after taking
account of related assistance from other Federal, State, or local government agencies. Within 90
days of execution of the HAP Contract, the owner must furnish to the North Carolina State
Office, through the housing authority, a schedule of actual final project costs paid, compared to
the project costs originally budgeted and presented to HUD. The seltedule of actual project costs
paid must be audited by a public accountant in aecordance with generally accepted auditing
standards. If the actual project costs, as shown by the submitted audited schedule, vary from
those budgeted and, as a result, would cause housing assistance payments under the HAP
Contract to exceed what is necessazy to provide affordable housing, adjustments must be made to
the amount of the housing assistance payments to the owner.
2
The Housing Authority may now execute an Agreement to Enter into a Housing
AssistancetPraumebne xec t dt Vor t tt e staT~of an constructig~ but only afteR tlz oowuerlhos
Agreemen lianee with 24 CFR 983.57. A copy of the
submitted the design architect's certification in comp
Ag ceed with this project based assistan cyPTO6D nl ~ set forthTn 24 CFR. Part 983rity may
pro
Any questions or concerns regarding this matter shouted be dizected to Jan Law> Public
Housing Ii.evitali2ation Specialist, at (336) 547-4000> extension 296.
Sincerely,
ichael A. Wiliiams
Y pirector
u Office of Public PLousing
Enclosures
~7
AGREEMENT TO ENTER INTO 0.S, Deportment of Noosing
HOUSING ASSISTANCE PAYMENTS and Urban Development
CONTRACT Office of Poblic and Indian Housing
AGREEMENT/CONTRACTNUMBER:
U. S. Depamnent of }lousing and Urban Development
Section 8 Housing Assistance Payments Program
Section 8 Certificate Program
Project Based Assistance
PARTIOFTHE
AGREEMENT TO ENTER INTO HOUSING ASSISTANCE PAYMENTS CONTRACT
This Agreement to Enter Into Housing Assistance Payments Contract ("Agreement") is entered into
between the
("PHA"), and
("Owner").
The Owner agrees to complete the work on unit(s) in accordance with Exhibit B When the work is
completed, the Owner and the PHA will enter into a Housing Assistance Payments Contract ("Contract")
which will allow the Owner to receive housing assistance payments from the PHA on behalf of eligible
Families ("Families") so that they may afford to rent the unit(s), The PHA has executed an Annual
Contributions Contract ("ACC") with HUD by which HUD agrees to provide funds to the PHA to ma ke
these housing assistance payments.
1.1 Sienificant Dates: Contents of Agreement.
A. Effective Date of Aereement:
B, Date of Commencement of Work. The date for commencement of work is not later than
calendar days after the effective date of this Agreement
C. Time for Completion of Work. The date for completion of work is not later than
calendar days after the effective date of this Agreement..
D Contents of Aereement. This Agreement consists of Part I, Part II, Form HUD 52531-B
dated December 1988 (if applicable, see Section 1.2), and the following exhibits:
Exhibit A.-The approved Owner's Application.
Page t of 15 form HUD•5253t•A (4/90)
ref Handbook 7420.8
Exhibit B: Description of work to be performed under this Agreement. (If this Agree-
ment is for rehabilitation of units, this exhibit shall contain the rehabilitation
work write up and, where determined necessary by the PHA, specifications
and plans.. If this agreement is For new construction, this exhibit shall
contain the drawings and specifications.)
Exhibit C: Identification of units by size and applicable initial Contract Rents.
Exhibit D: The Housing Assistance Payments Contract ("Contract") complete with
respect to the AgreemendContractmsmber, the identification of the PHA and
Owner, and Exhibit B.
Exhibit E: The schedule of completion of stages, if applicable, (This exhibit shall
identify the units in each stage.)
Exhibit F: Exhibit required if this Agreement is for new construction. This exhibit
shall contain the design architect's certification that the proposed new
construction reflected in the working drawings and specifications complies
with Housing Quality Standards, local codes and ordinances, and zoning
requirements,
Additional Exhibits: (Specify additional exhibits, such as Davis-Bacon Wage Rate
Schedule, if any, If none, insert "None" )
This Agreement, including the exhibits, is the entire Agreement between the PHA and
Owner.
E. Nature of Work. (Check which is applicable,)
[ ] This Agreement is for rehabilitation of units to be assisted by project-based assistance
under the Section 8 Certificate Program.
[ ] This Agreement is for new construction of units to be assisted by project-based assis-
tance under the Section 8 Certificate Program..
Page 2 of 15 form Htln-52531-A (4/90)
ref. Handbook 74208
.~
1,2 Anolicability of Part II Provisions.
2.1 Trainine. Employment, and Contracting Opportunities for Businesses and Lower-Income
Persons. (Applies if the total of Contract Rents for al] units under the proposed Contract,
over the minimum term of the Contract, is more than $500,000 or $2,778 per month).
[ ] Applicable [ ] Not Applicable
2.2 Eeual Emwment Opportunitu. (Applies only to construction contracts of more
than $10,000,)
[ ] Applicable [ ] Not Applicable
2..3 Clean Air Act and Federal Water Pollution Control Act. (Applies if the total of Contract
Rents for all units under the Contract, over the maximum term of the Contract, is more
than $100,000 or $556 per month),
[ ] Applicable [ ] Not Applicable
Z.4 Labor Standards Requirements. (Sections 2.4, 2.8 and 2.10 apply when this Agreement
covers nine or more units.) 2.4 HUD-Federal Labor Standards Provisions, 2..8 Wage
Claims and Adjustments; 2.10 Evidence of Unit(s) Completion; Escrow.
[ ] Applicable [ ] Not Applicable
2.11 Flood Insurance. (Applies if units are located in areas having special flood hazards and in
which flood insurance is available under the National Flood Insurance Program.)
[ ] Applicable [ ] Not Applicable
1..3 PHA Assurance to Owner.
The PHA warrants that it is a "public housing agency" as defined in the U S Housing
Act of 1937, that it is authorized to execute an Agreement in accordance with FIUD
regulations and requirements and that it has an ACC with HUD.
Page 3 of 15 form HUD-52531-A (4/90j
ref Handbook 7420 8
1.4 Schedule of Completion
A. Timel Performance of Work. The Owner agrees to begin work no later than the
date for commencement of work as stated in Section 1 I B In the event the work
is not commenced, diligently continued and completed as required under this
Agreement, the PHA may terminate this Agreement or take other appropriate
action. The Owner agrees to report promptly to the PHA the date work is
commenced and furnish the PHA with progress reports as required by the PHA,
B Time for Completion. All work must be completed no later than the end of the
period stated in Section 1 LC. Where completion in stages is provided for, work
related to units included in each stage shall be completed by the stage completion
date in Exhibit E, and all work on all stages must be completed no later than the
end of the period stated in Section 1. LC.
C Delavs. If there is delay in the completion due to unforeseen factors beyond the
Owner's control as determined by the PHA, the PHA agrees to extend the time
for completion for an appropriate period as determined by the PHA, In the case
of'such delays, the PHA shall reduce the term of the Contract so that the Contract
term does not extend beyond the last date of the ACC term for the A CC funding
authority from which the Contract is to be funded.
L5 Rehabilitation Period,
A. Establishment of Initial Contract Rent.
The initial Contract Rent for each unit may in no event exceed the amount
authorized in accordance with HUD regulations and requirements.
2, The Contract Rents stated in Exhibit C of this Agreement will be the initial
Contract Rents specified in the Contract unless a lower initial Contract Rent is
established by the PHA in accordance with paragraph B of this section, or
Section 1.14A of this Agreement. The initial Contract Rents stated in Exhibit C
of this Agreement shall not be increased for any reason, including changes in the
work.
Page 4 of 15 form Ht1D•5253YA (4/90j
ref. Handbook 7420 B
I
B. Establishment of Lower hlitial Contract Rent.
1 Excessive Rent. Where the initial Contract Rent for any unit would otherwise
exceed the amount authorized in accordance with HUD regulations and require-
ments, the PHA shall establish a lower initial Contract Rent in accordance with
such regulations and requirements. Such lower rent shall be established at the
amount determined by HUD,
2. Changes in the Work.
(a) The Owner must obtain prior PHA approval for any change from the
work specified in Exhibit B which would alter the design or quality of
the rehabilitation or constmction. The PHA is not required to approve
any changes requested by the Owner. PHA approval of any change may
be conditioned on establishment of lower initial Contract Rents at the
amounts determined by HUD,
(b) If the Owner makes any changes in the work without prior PHA ap-
proval, the PHA may establish lower initial Contract Rents at the
amounts determined by HUD,.
3, Insured or coinsured Morteaee. When a HUD insured or a HUD coinsured
multifamily mortgage is used, the PHA shall establish lower initial Contract
Rent, in the amounts determined by HUD to reflect any reduction in the amount
necessary to amortize the insured or coinsured mortgage,
C List of Vacancies, At least sixty days prior to the scheduled completion of the work
described in Exhibit B (where completion in stages is provided, sixty days prior to
completion of each stage), the Owner shall notify the PHA in writing of any unit(s)
expected to be vacant at the anticipated effective date of the Contract.. The PHA shall
refer to the Owner appropriate-sized families from the PHA waiting list. When the
Contract is executed, the Owner shall notify the PHA which units are vacant.
D, Prohibition Against Displacement of Residential Tenants from Assisted Units. The
Owner agrees that work on any unit to be subsidized with assistance under this Contract
shall not result in the displacement of residential tenants from the units to be subsidized..
If a residential tenant is displaced through a waiver of
Page 5 of 15 form HUD•52531•A (4/90)
reF Handbook 7420 8
~~~
this requirement or in violation of this requirement, the owner shall provide relocation
assistance for displaced person in accordance with the regulations which implement the
Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970,
E. Temporary Relocation.. The Owner agrees that lawful residential tenants shall not be
required to move temporarily from a stmcture or complex unless:
I The Owner has given the tenants advance written notice and appropriate advisory
services;
Z. Decent, safe, and sanitary temporary housing is available;
3. The temporary relocation period will not exceed I2 months; and
4, The Owner reimburses tenants for reasonable out-of-pocket expenses incurred in
connection with the temporary relocation, including moving costs to and from
temporary housing and increases in monthly housing costs.
These requirements apply only to lawful residential tenants (but not to owner-occupants
or businesses) who are temporarily relocated following submission of the Owner's
application to the PHA. The requirements do not apply to tenants who commence
occupancy after the Owner's submission ofan application if; before they commence
occupancy, they are provided written notice from the Owner of the impending work and
possible temporary relocation, or whose tenancy is terminated for cause based upon a
serious or repeated violation of material terms ofthe lease or occupancy agreement,
Inspections. The PHA (or HUD in the case of insured or coinsured mortgages) may
inspect the work during rehabilitation or construction to ensure that work is proceeding
on schedule, is being accomplished in accordance with the terms of the Agreement,
meets the levels of material described in Exhibit B, and meets typical levels of workman-
ship in the area,
1.6 Work Completion.
A. Conformance with Exhibit B, The completed work must be in accordance with Exhibit B,
The Owner is solely responsible For c ompletion of the work.
Page 6 of 15 torm HUD-52531-A (4/90)
ref. Handbook 7420.8
B. Notification of Completion. The Owner agrees to notify the PHA when the work is
completed and 4o submit to the PHA the items described in paragraph C of this section.
C. Evidence of Completion. When the work is completed, the Owner must provide the
PHA with the following:
A certificate of occupancy and other official approvals as required by the local-
ity.
2. A certification by the Owner that:
(a) The work has been completed in accordance with the requirements of
this Agreement;
(b) There are no defects or deficiencies in the work except for items of
delayed completion which are minor or which are incomplete because of
weather conditions and, in any case, do not preclude or affect occupancy,
(c) The unit(s) has been rehabilitated or constructed and is in accordance
with applicable zoning, building, housing and other codes, ordinances or
regulations, as modified by any waiver obtained from appropriate
officials;
(d) Any unit built prior to 1978 is in compliance with applicable HUD Lead
Based Paint regulations; and
(e) If'L,abor Standards Requirements are applicable, the Owner has com-
plied with the requirements of Section 2.10 of this Agreement.
3. For projects where construction inspections by HUD staff are not required by
HUD, a certification from the inspecting architecC stating that the units have been
constmcted in accordance with the certified working drawings and specifica-
tions, Housing Quality Standards, local codes and ordinances, and zoning
requirements.
D Review and Inspection.
ARer receipt of the evidence of completion, the PFIA agrees to review the
evidence of completion for compliance with paragraph C of this section and, if
applicable, Section 2,10.
Page 7 of 75 form HUD-52537-A (4/90)
ref. Handbook 7420.8
la
2. A PHA representative must inspect the unit(s) to be assisted to determine that the
work has been completed in accordance with the requirements of this Agree-
ment. If the inspection discloses defects or deficiencies the inspector will report
them to the PHA with sufficient detail and information for purposes of this
section.
Acceptance. If the PHA determines from the review and inspection that all the work has
been completed in accordance with the requirements of this Agreement, the unit(s) must
be accepted.
Acceptance Where Defects or Deficiencies Reported, If the work is not acceptable, the
following shall apply:
1. If there are any items of delayed completion which are minor items or which are
incomplete because of weather conditions and in any case which do not preclude
or affect occupancy, and all other requirements of the Agreement have been met,
the unit(s) may be accepted.. The Owner shall deposit in escrow with the PHA
funds in an amount the PHA determines to be sufficient to assure completion of
the delayed items, and shall execute a written agreement with the PHA (in the
form prescribed by the PHA) which specifies the schedule for completion of the
items. If the Owner fails to deposit such escrow, or to execute such written
agreement, or if items are not completed within the agreed time period, the PHA
may terminate the Agreement or Contract or exercise other rights under the
Agreement or Contract.
2 If other defects or deficiencies exist, the PHA shall determine whether and to
what extent the defects or deficiencies are correctable, whether the unit(s) will be
accepted after correction of defects or deficiencies, and the requirements and
procedures for such correction and acceptance. Furthermore, the PHA shall
determine whether lower initial Contract Rents shall be established, and whether
the term of the Contract shall be reduced. The Owner shall be notified of the
PFIA's decision.
G Notification of Nonacceptance. If the PHA determines that, based on the review of the
evidence of completion and inspection, any unit is not accepted, the Owner shall be
promptly notified of'this decision and the reasons.
H. Completion in Staees. Where completion in stages is provided for, the procedures of this
section shall apply to each stage.
Page B of 15 form HUD-52531•A (4/90)
ref. Handbook 7420.8
~~
1.7 Execution of Housing Assistance Payments Contract,
A, Time and Execution. Upon acceptance of the units by the PHA, the Owner and the PHA
agree to execute the Contract.
B. Completion in Staees. Where completion in stages is provided for, the number and types
of units in each stage, and the initial Contract Rents for such units, shall be separately
shown in Exhibit A of the Contract for each stage. Upon acceptance of the first stage,
the Owner shall execute the Contract and the signature block provided in the Contract for
that stage, Upon acceptance of each subsequent stage, the Owner shall execute the
signature block provided in the Contract for such stage.
C.. Form of Contract. The terms of the Contract shall be as provided in Exhibit D of this
Agreement. There sha 11 be no change in the terms of the C ontract other than as provided
in this Agreement. Prior to execution by the Owner, all blanks in the Contract shall be
completed by the PHA.
D. Survival of Owner Obli atg ions.. Even after execution of the Contract, the Owner shall
continue to be bound by all Owner obligations under the Agreement.
1.8 Cooperation in Equal Opportunity Compliance Reviews: Nondiscrimination.
A. The Owner and the PHA agrees to cooperate with HUD in the conducting ofthe compli-
ance reviews and complaint investigations pursuant to all applicable civil rights statutes,
Executive Orders, and rules and regulations.
B. 1. In carrying out of the obligations under this Agreement, the Owner will not
discriminate against any employee or applicant for employment because of race,
color, creed, religion, sex, handicap or national origin. The Owner will take
affirmative action to insure that applicants are employed, and that employees are
treated during employment, without regard to their race, color, creed, religion,
sex, handicap or national origin, Such action shall include, but not be limited to,
the following: employment, upgrading, demotion, or transfer; recruitment or
recruitment advertising, layoff or termination; rates of pay or other forms of
compensation; and selection for training, including apprenticeship,
2. The Owner agrees to post in conspicuous places, available to employees and
applicants for employment, notices to be provided by I-IUD setting forth the
provisions of this nondiscrimination clause. The Owner will in all solicitations
or advertisements For employees placed by or on behalf
Page 9 of 15 form FIUD-52531-A (4/90)
ref Handbook 7420 8
!' f
of the Owner state that all qualified applicants will receive consideration for
employment without regard to race, color, creed, religion, sex, handicap or
national origin. The Owner will incorporate the foregoing requirements of this
paragraph B in all of its contracts for Project work, except contracts for standard
commercial supplies or raw materials, and will require all of its contractors for
such work to incorporate such requirements in all subcontracts for project work
1 9 PHA and Owner Relations to Third Parties.
A Selection and Performance of Contractor.
The PHA has not assumed any responsibility or liability to the Owner or any
other party for the performance of any contractor, subcontractor or supplier,
whether or not listed by the PHA as qualified contractor or supplier under the
Program. The selection of a contractor, subcontractor or supplier for perfor-
mance of the work is the sole responsibility of the Owner, and the PHA has no
involvement in any relationship between the Owner and any contractor, subcon-
tractor or supplier..
2. The Owner must select a competent contractor to undertake the rehabilitation or
construction. The Owner agrees to require from each prospective contractor a
certification that neither the contractor nor its principals is presently debarred,
suspended, proposed for debarment, declared ineligible, or voluntarily excluded
from participation in contracts by the Comptroller General or any Federal
department or agency. The Owner agrees not to award contracts to, otherwise
engage the services of; or fund any contractor that does not provide this certifica-
tion.
B. Iniurv Resulting from Work under the Agreement. The PHA has not assumed any responsibility
for or liability to any person, including a worker or a resident of the unit undergoing work
pursuant to this Agreement, injured as a result of the work or as a result of any other action or
failure to act by the Owner, or any contractor, subcontractor or supplier,
C Leeal Relationship. The Owner is not the agent of the PHA, and this Agreement does not create
or affect any relationship between the PHA and any lender to the Owner or any suppliers, em-
ployees, contractors or subcontractors used by the Owner in the implementation of the Agree-
ment,
Page t0 of i5 form HUU•52531-A (4190)
ref Handbook 7420.8
~5
D Exclusion of Third Party Claims. Nothing in this Agreement shall be construed as
creating any right of any third party (other than HUD) to enforce any provision of this
Agreement or the Contract, or to assert any claim against HUD, the PHA or the Owner
under the Agreement or the Contract.
E. Exclusion of Owner Claims Against HUD. Nothing in this Agreement shall be constmed
as creating any right of the Owner to assert any claim against HUD,
1.10 Riehts of HUD if PHA Defaults Under Agreement.
If HUD determines that the PHA has failed to comply with this Agreement, or has failed to take
appropriate action, to HUD's satisfaction or as directed by IIiJD, for enforcement of the PHA's
rights under this Agreement, HUD may assume the PHA's rights and obligations under the
Agreement, and may perform the obligations and enforce the rights of the PHA under the Agree-
ment. HUD will, if it determines that the Owner is not in default, pay Annual Contributions for
the purpose of making housing assistance payments with respect to the dwelling unit(s) under
this Agreement for the duration of the Contract..
l,l l Conflict of Interest.
A. Interest of Members. Officers, or Employees of PHA. Members of Local Government
Body, or Other Public Officials. No present or former member or officer of the PHA
(except tenant-commissioners), no employee of the PHA who formulates policy or
influences decisions with respect to [he Section 8 Program, and no public official or
member ofa governing body or State or local legislator who exercises functions or
responsibilities with respect to the Section 8 Program, shall have any direct or indirect
interest, during his or her tenure or for one year thereafter, in this Agreement or the
Contract or in any proceeds or benefits arising from the Agreement or Contract. This
provision may be waived by HUD for good cause..
B. Disclosure. The Owner warrants that the Owner has disclosed to the PHA:
(1) The identity of the Owner, developer, builder, architect, management agent (and
other participants) and the names of officers and principal members, sharehold-
ers, investors, and other parties having a substantial interest in this Agreement or
the Contract or in any proceeds or benefits arising from the Agreement or
Contract;
Page 11 of 15 form HUD-52531-A (4/gD)
ref Handbook 7420.8
~~
(2) The previous participation of each of these parties in HUD programs on the
prescribed HUD form; and
(.3) Any possible conflict of interest by any of these parties that would be a violation
of the Agreement or the Contract.
The Owner shall fully and promptly update such disclosures.
1,12 Interest of Member or of Deleeate to Conte.
No member of or de legate to the Congress of the United States of America or resident commis-
sionershall beadmitted to any share or part of this Agreement or to any benefits which may arise
therefrom,
1.13 Assienment of [he Agreement or Contract or Interest in It.
A. The Owner agrees that the Owner has not made and will not make any transfer in any
form, including any sale or assignment, of this Agreement or the Contract or the property
without the prior written consen t of the PHA. A change in ownership in the Owner, such
as a stock transfer or transfer of the interest of a limited partner, is not subject to the
provisions of this section. Transfer of the interest of a general partner is subject to the
provisions of this section..
B. Where the Owner requests the consent of the PHA for a transfer in any form, including
any sale or assignment, of this Agreement or the Contract or the property, the PHA will
review the transferee's previous participation in the HUD programs. The PHA will give
its consent to a transfer ofthe Agreement or Contract pursuant to paragraph A of this
section if the transferee agrees in writing (in a form acceptable to the PHA) to comply
with all terms of the Agreement and Contract, and if the transferee is acceptable to the
PHA. The PHA's criteria for acceptance of the transferee must be no more restrictive
than initial acceptance of any Owner under the program at the time of the Owner's
request.
C. If an Owner is proposing to pledge the Agreement or HAP Contract as security for
financing, the Owner must submit the financing documents to the PHA for approval In
determining the approvability of a pledge arrangement, the PHA must review the docu-
ments submitted by the Owner to ensure that the financing documents do not modify the
Agreement or Contract, and do not contain any requirements inconsistent with the
Agreement or Contract. Any pledge of the Agreement or Contract must be limited to
amounts payable under the Contract in accordance with the terms of the Contract.
Page 12 of i5 farm HUD-52531-A (4/98)
ref. Handbook 7428.8
i~
L 14 Owner Assurance to the PHA.
A. Disclosure of Other Government Assistance. The Owner shall disclose to the PHA in
accordance with HUD requirements information regarding any related assistance from
the Federal Government, a State, or a unit of general local government, or any agency or
instrumentality thereof; that is made available or is expected to be made available with
respect to the Contract Units. Such related assistance shall include, but not be limited to,
any loan, grant, guarantee, insurance, payment, rebate, subsidy, credit, tax benefit, or any
other form of direct or indirect assistance. Housing assistance payments under the
Contract shall not be more than is necessary , as determined by the PHA in accordance
with HUD requirements, to provide affordable housing af4er taking account of'such
related assistance. The PI-IA shall adjust in accordance with HUD requirements the
amount of the Dousing assistance payments to the Owner to compensate in whole or in
part for such related assistance.
B, Rehabilitation or Construction Financing.. The Owner agrees not to rehabilitate or
construct the units with assistance under the U S. Housing Ac t of 19.37 (e.g., public
housing, the rental rehabilitation program, housing ,development grants, Section 1 I(b)
tax exempt bonds, or other Section 8 programs) or the flexible subsidy program, The
Owner warrants that the units were not rehabilitated or constructed with assistance under
the U.S Housing Ac t of 1937 in the five years before execution of this Agreement, HUD
may approve attachment of assistance to a unit that was rehabilitated with public housing
modernization funds before conveyance to a resident management corporation where
attachment of project-based assistance would further the purposes of the sale of the
public housing project to the corporation.
C. Ownership. The Owner warrants that the property to be rehabilitated or constructed
under this Agreement is not owned by the PHA, or an entity controlled by the PHA.
1.15 Other Federal Requirements.
The Owner shall comply with and shall be subject to the requirements of the following, where
applicable:
A Executive Orders 12432, Minority Business Enterprise Development, and 121.38, Creat-
ing aNational Women's Business Enterprise Policy.
Page 13 of 15 form HUD•52531-A (4/90)
reF Handbook 7420 8
(6
B. Executive Order 1 1625, Prescribing Additional Arrangements for Developing and
Coordinating a National Program for Minority Business Enterprises,
C. 24 CFR Part 24, Debarment, Suspension, and Limited Denial of Participation.
L16 Lobbyn~Certifications,
The Owner hereby assures and certifies that:
A No Federally appropriated funds have been paid or will be paid, by or on behalf of the
Owner, to any person for influencing or attempting to influence an officer or employee of
any agency, a Member of Congress, an officer or employee of Congress, or an employee
of a Member of Congress in connection with the awarding of any Federal contract, the
making of any Federal grant, the making of any Federal loan, the entering into of any
cooperative agreement, and the extension, continuation, renewal, amendment, or modifi-
cation of any Federal contract, grant, loan, or cooperative agreement.
B If any funds other than the Federally appropriated funds have been paid or will be paid to
any person for influencing or attempting to influence an officer or employee of any
agency, a Member of Congress, an officer or employee of Congress, or an employee of a
Member of Congress in connection with this Federal contract, grant, loan, or cooperative
agreement, the Owner shall complete and submit standard form L.LL., "Disclosure Form
to Report Lobbying," in accordance with its instructions..
C. The Owner shall require that the language of this certification be included m the award
documents for all subawards at all tiers (including subcontracts, subgrants, and contracts
under grants, loans, and cooperative agreements) and that all subreceipients shall certify
and disclose accordingly..
This certification is a material representation of fact upon which reliance was placed
when this transaction was made or entered into. Submission of this certification is a
prerequisite for making or entering into this transaction imposed by section 1352, title
31, t7.S. Code. Any person who fails to file the required certification shall be subject to a
civil penalty of not less than $10,000 and of not more than $100,000 for each such
failure,
Page 14 of 15 form HUD-52531-A (4/90)
ref Handbook 74208
~~
1.17 Notices.
Where the Owner is required to give any notice to the PHA pursuant to this Agreement, such
notice shall be in writing and shall be given in the manner designated by the PHA..
1.18 HUD Requirements.
The Agreement and Contract shall be interpreted and implemented in accordance with HUD
requirements.
1.19 Termination of Contract.
This Agreement or the Contract can be terminated upon at least .30 days written notice to the
Owner by the PHA or HUD if the PHA or HUD determines that the Contract Units were not
selected in accordance with the PHA's HUD-approved written selection policy or that the Con-
tract Units were not eligible for selection in conformity with HUD requirements..
PHA
By
(Official Title)
Date
Owner
By
(OfTicial Title)
Date
Wamine: 18 U.S,C, 1001 provides, among other things, that whoever knowingly and willfully makes or uses a document or
writing containing any false, fictitious, or fraudulent statement or entry, in any matter within the jurisdiction of any department
or agency of the United States, shall be fined no more than $10,000 or imprisoned for not more than five years, or both.
Page t5 of 15
form HUD-52531-A (4/90)
ref Handbook 7420.8
a~
AGREEMENT 70 ENTER INTO U.S. Department of Housing
HOUSING ASSISTANCE PAYMENTS and Urban Development
CONTRACT Office of Public and Indian Housing
AGREEMENT/CONTRACT NUMBER:
U S. Department of Housing and Urban Development
Section 8 Housing Assistnnce Payments Program
Section 8 Certificate Program
Project Based Assistance
PART II OF THE
AGREEMENT TO ENTER INTO HOUSING ASSISTANCE PAYMENTS CONTRACT
2, I TRAINING EMPLOYMENT AND CONTRACTING OPPORTUNITIES FOR BUSINESSES
AND LOWER-INCOME PL•RSONS.
(a) The project assisted under this Agreement is subject to the requirements of Section 3 of
the Housing Urban Development Act of 1968, as amended, 12 U.S,C 1701 u. Section 3
requires that to the greatest extent feasible, opportunities for training and employment be
given lower-income persons residing within the unit of'local government or the metro-
politan area (or nonmetropolitan county), as determined by the Secretary, in which the
project is located and contracts for work in connection with the project be awarded to
business concerns which are located in, or owned in substantial part by persons residing
in, the same metropolitan area , (or nonmetropolitan county) as the project.
(b) Notwithstanding any other provision of this Agreement, the Owner shall carry out the
provisions of Section .3 and the regulations issued by HUD as set forth in 24 CFR, Part
135, and all applicable rules and orders of HUD issued thereunder prior to the execution
of this Agreement. The requirements of the regulations include, but are not limited to,
development and implementation of an affirmative action plan for utilizing business
concerns located within, or owned in substantial part by persons residing in, the area of
the project; the making of a good faith effort, as defined by the regulations, to provide
training, employment, and business opportunities required by Section .3; and incorpora-
tion of the "Section .3 clause" specified by Section 135.20(b) of the regulations and
paragraph (d) of this section in all contracts for work in connection with the project. The
Owner certifies and agrees that he or she is under no contractual or other disability which
would prevent compliance with these requirements.
Page 1 of 16 HUD-52537-8 (12/68)
ref. Handbook 7420 6
~i
(c) Compliance with the provisions of Section .3, the regulations set forth in 24 CFR, Part
1.35, and all applicable rules and orders issued by HUD thereunder prior to execution of
this Agreement, shall be a condition of the Federal financial assistance provided to the
project, binding upon the Owner, the Owner's contractors and subcontractors, successors,
and assigns, Failure to fulfill these requirements shall subject the Owner, the Owner's
contractors and subcontractors, successors, and assigns to the sanctions specified by this
Agreement, and to such sanctions as are specified by 24 CFR, Section 1.35.1.35.
(d) The Owner shall incorporate or cause to be incorporated into any contract or subcontract
for work pursuant to this Agreement in excess of $50,000 cost, the following clause:
"EMPL,OYMENT OF PROJECT AREA RESIDENTS AND CONTRACTORS"
"A. The work to be performed under this Contract is on a project assisted under a program providing
direct Federal financial assistance from HUD and is subject to the requirements of section 3 of
the Housing and Urban Development Act of 1968, as amended, 12 U.S.C. 1701 u Section 3
requires 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 nonmetropolitan area
(or nonmetropolitan county), as determined by the Secretary, in which the project is located and
contracts for work in connection with the project be awarded to business concerns which are
located in, or owned in substantial part by persons residing in, the same metropolitan area (or
nonmetropolitan county) as the project..
"B. The parties to this Contract will comply with the provisions of Section 3 and the regulations
issued by HUD as set forth in 24 CFR, Part 1.35, and all applicable roles and orders of HUD
issued thereunder prior to the execution of the Agreement. The parties to this Contract certify
and agree that they are under no contractual or other disability which would prevent them from
complying with these requirements.
"C. The contractor will send to each labor organization or representative of workers with which the
contractor has a collective bargaining agreement or other contract or understanding, if any, a
notice advising the labor organization or workers' representative of the commitments under this
Section 3 clause and shall post copies of't11e notice in conspicuous places available to employees
and applicants for employment or training.
Page 2 of i6 HUD-52531-B (72/88)
ref Handbook 7420 8
as
"D The contractor will include this Section .3 clause in every subcontract for work in connection with
the project and will at the direction of the applicant For or recipient of Federal financial assis-
tance, take appropriate action pursuant to the subcontract upon a finding that the subcontractor is
in violation of regulations issued by HIID, 24 CFR, Part 1.35, The contractor will not subcontract
with any subcontractor where the contractor has notice or knowledge that the latter has been
found in violation of regulations under 24 CFR, Part 135, and will not let any subcontract unless
the subcontractor has first provided the contractor with a preliminary statement ofability to
comply with the requirements of these regulations.
"F. Compliance with the provisions of Section 3, the regulations set forth in 24 CFR, Part 135, and
all applicable roles and orders of the Department issued thereunder prior to the execution of the
Agreement to Enter Into Housing Assistance Payments Contract, shall be a condition of the
Federal financial assistance provided to the project, binding upon the Owner, the Owner's
contractors, and subcontractors, successors, and assigns. Failure to fulfill these requirements
shall subject the Owner, the Owner's contractors, successors, and assigns to those sanctions
specified by the Agreement to Enter Into Housing Assistance Payments Contract, and to such
sanctions as are specified in 24 CFR, Section 13S.13S."
(e) The Owner agrees to be bound by the above Section .3 clause with respect to his or her own
employment practices when participating in federally assisted work.
2.2 EQUAL EMPLOYMENT OPPORTUNITY
(a) The Owner shall incorporate or cause to be incorporated into any contract in excess of $10,000
cost for construction work, or modification thereof, as defined in the regulations of the Secretary
of Labor at 41 CFR, Chapter 60, which is to be performed pursuant to this Agreement, the
following Equal Opportunity clause:
"EQUAL. EMPLOYMENT OPPORTUNITY"
"During the performance of this contract, the contractor agrees as follows:
"(1) The contractor will not discriminate against any employee or applicant for employment because
of race, color, creed, religion, sex, or national origin. The contractor will take affirmative action
to ensure that applicants are employed, and that employees are kreated during employment,
without regard to their race, color, religion, creed, sex, or national origin. Such action shall
include, but not be limited to, the following: employment, upgrading, demotion, or transfer;
recruitment or recruitment advertising; layoffs or termination; rates of pay or other forms of
compensation; and selection for training,
Page 3 of 16 HUD-52531-8 (12/88)
ref Handbook 7420 8
a3
including apprenticeship.. The contractor agrees to post in conspicuous places, available to
employees and applicants for employment, notices setting forth the provisions of this Equal
Opportunity clause,
"(2) The contractor will, in all solicitations or advertisements for employees placed by or on behalf of
the contractor, state that all qualified applicants will receive consideration for employment
without regard to race, color, religion, creed, sex, or national origin,
"(3) The contractor will send to each labor union or representative of workers with which the contrac-
torhas a collective bargaining agreement or other contract or understanding, a notice to be
provided by or at the direction of the Government advising the labor union or workers representa-
tive of the contractor's commitments under this section, and shall post copies of the notice in
conspicuous places available to employees and applicants for employment.
"(4) The contractor of will comply with all provisions of Execu five Order No. 1 1246 of September
24, 1965, and of the rules, regulations, and relevant orders of the Secretary of Labor.
"(5) The contractor will furnish all information and reports required by Executive Order No. 11246 of
September Z4, 1965, and by the rules, regulations, and orders of the Secretary of Labor, or
pursuant thereto, and will permit access to its books, records, and accounts by HiID and the
Secretary of Labor for purposes of investigation to ascertain compliance with such rules, regula-
tions and orders.
"(6) In the event of the confractor's noncompliance with the Equal Opportunity clauses of this con-
tract or with any of the rules, regulations, or orders, the contract may be canceled, terminated, or
suspended in whole or in part and the contractor may be declared ineligible for further contracts
in accordance with procedures authorized in Executive Order No. 11246 of September 24, 1965,
and such other sanctions as may be imported and remedies invoked as provided in Executive
Order No. 11246 of September 24, 1965, or by rule, regulation, or order of the Secretary of Labor
or as otherwise provid ed by law.
"(7) The contractor will include the portion of the sentence immediately preceding Paragraph (1) and
the provisions of Paragraphs (I) through (7) in every subcontract or purchase order unless
exempted by the rules, regulations, or orders of the Secretary of Labor issued pursuant to Section
204 of Executive Order No, 11246 of September 24, 1965, so that such provisions will be binding
upon each subcontractor or vendor. The contractor will take such action with respect to any
subcontract or purchase order as the Government may direct as a means of enforcing such
provisions including sanctions for noncompliance; provided, however, that in the event a eontrac-
torbecomes involved in,
Page 4 of 16 HUD-52531-B (12/88)
ref Handbook 7420 8
~~
or is threatened with, litigation with a subcontractor or vendor as a result of such direction by the
Government, the contractor may request the United States to enter into such litigation to protect
the interest of'the United States."
(b) The Owner agrees to be bound by the above Equal Opportunity clause with respect to his or her
own employment practices when participating in federally assisted construction work..
(c) The Owner agrees to assist and cooperate actively with HUD and the Secretary of Labor in
obtaining the compliance of contractors and subcontractors with the Equal Opportunity clause
and the rules, regulations, and relevant orders of the Secretary of Labor, to fumis h HUD and the
Secretary of Labor such information as they may require for the supervision of'such compliance,
and to otherwise assist HUD in the discharge of HUD's primary responsibility for securing
compliance,
(d) The Owner Further agrees to refrain from entering into any contract or contract modification
subject to Executive Order No. 11246 of September 24, 1965, with a contractor debarred from, or
who has not demonstrated eligibility for, Government contracts and federally assisted construc-
tion contracts pursuant to the Executive Order and will carry out such sanctions and penalties for
violation of the Equal Opportunity clause as may be imposed upon contractors and subcontrac-
tors by HUD or the Secretary of Labor pursuant to Part II, Subpart D of the Executive Order, In
addition, if the Owner fails or refuses to comply with these undertakings, HUD may take any or
all of the following actions; cancel, terminate, or suspend in whole or in part this Agreement;
refrain from extending any further assistance to the Owner under the program with respect to
which the failure or refusal occurred until satisfactory assurance of future compliance has been
received from the Owner, and refer the case to the Deparhnent of Justice for appropriate legal
proceedings.
2.3 CLEAN AIR ACT AND FEDERAL WATER POLLUTION CONTROL
In compliance with regulations issued by the Environmental Protection Agency (EPA), 40 CFR,
Part I5, pursuant to the Clean Air Act, as amended (Air Act), 42 U.S.C. 7401, et s eq., the Federal
Water Pollution Control Act, as amended (Water Act), 33 U.S.C. 1251, et seq., and Executive
Order 11738, the Owner agrees to:
(a) Not utilize any facility in the performance of this Agreement or any subcontract which is
listed on the EPA list of Violating Facilities pursuant to Part 15 of the regulations for the
duration of time that the Facility remains on the list;
Page 5 of i6 HUD-52531-8 (12/88)
ref Handbook 7420 8
as
(b) Promptly notify the PHA if a facility the Owner intends to use in the performance of this
Agreement is on the L^PA L.ist of Violating Facilities or the Owner knows that is has been
recommended to be placed on the List;
(c) Comply with all requirements of the Air Act and the Water Act, including the require-
ments of Section 114 of the Air Act and Section 308 of the Water Act, and all applicable
clean air standards and clear water standards; and
(d) Include or cause to be included the provisions of'this section in every subcontract, and
take such action as HUD may direct as a means of enforcing such provisions.
2.4 HUD-FEDERAL LABOR STANDARDS PROVISIONS.
The Owner is responsible for inserting the entire text of Sections 2 4 (a) and (b) of this Agree-
ment in all construction contracts and, if the Owner performs any rehabilitation work on the
project, the Owner must comply with all provisions of Section 2.4(a) and (b).
(a)(1)(i) Minimum Waees. All laborers and mechanics employed or working upon the site of the
work (or under the United States Housing Act of 1937 or under the Housing Act of 1949
in the construction or development of the project), will be paid unconditionally and not
less often than once a week, and without subsequent deduction or rebate on any account
(except such payroll deductions as are permitted by regulations issued by the Secretary of
Labor under the Copeland Act (29 CFR Part 3)), the full amount of wages and bona fide
fringe benefits (or cash equivalents thereof) due at time of payment computed at rates not
less than those contained in the wage determination of the Secretary of Lab or which is
attached hereto and made part hereof regardless of any contractual relationship which
may be alleged to exist between the contractor and such laborers and mechanics. Contri-
butions made or costs reasonably anticipated for bona fide fringe benefits under Section
1(b)(2) of the Davis-Bacon Acton behalf of laborers or mechanics are considered wages
paid to such laborers or mechanics, subject to the provisions of 29 CFR 5.5(a)(1)(iv);
also, regular contributions made or costs incurred for more than a weekly period (but not
less often than quarterly) under plans, funds, or programs, which cover the particular
weekly period, are deemed to be constructively made or incurred during such weekly
period,
Such laborers and mechanics shall be paid the appropriate wage rate and fringe benefits
on the wage determination for the classification of work actually performed, without
regard to skill, except as provided in 29 CFR Part 5 5(a)(4) Laborers or mechanics
performing work in more than one classification may be compensated at the rate speci-
fied for each classification for the time actually worked therein: Provided, That the
Page 6 of i6 HUD-52531-B (12/86)
ref Handbook 7420.8
a~
employer's payroll records accurately set forth the time spent in each classification in
which work is performed. The wage determination (including any additional classifica-
tion and wage rates conformed under 29 CFR Part 5.5(a)(I)(ii) and the Davis-Bacon
poster (WH-1.321)) shall be posted at all times by the contractor and its subcontractors at
the site of the work in a prominent and accessible place where it can be easily seen by the
workers.
(ii) (A) Any class of laborers or mechanics which is not listed in the wage determination and
which is to be employed under the contract shall be classified in conformance with the
wage determination. HUD shall approve an additional classification and wage rate and
fringe benefits therefore only when the following criteria have been met:
(I) The work to be performed by the classification requested is not performed by a
classification in the wage determination; and
(2) The classification is utilized in the area by the construction industry, and
(.3) The proposed wage rate, including any bona fide fringe benefits, bears a reason-
able relationship to the wage rates contained in the wage determination.
(B) If the contractor and the laborers and mechanics to be employed in the classification (if
known), or their representatives, and IND or its designee agree on the classification and
wage rate (including the amount designated for fringe benefits where appropriate), a
report of the action taken shall be sent by IND or its designee to the Administrator of the
Wage and I-Iour Division, Employment Standards Administration, U. S. Department of
Labor, Washington, D C. 20210, The Administrator, or an authorized representative,
will approve, modify, or' disapprove every additional classification action within 30 days
of receipt and so advise HUD or its designee or will notify HUD or its designee within
the .30-day period that additional time is necessary, (Approved by the Office of Manage-
ment and Budget under OMB control number 1215-0140.)
(.~ In the event the contractor, the laborers or mechanics to be employed in the classification
or their representatives, and FIUD or its designee do not agree on the proposed classifica-
tion and wage rate (including the amount designated for fringe benefits, where appropri-
ate), HUD or its designee shall refer the questions, including the views of all interested
parties and the recommendation of HUD or its designee, to the Administrator for deter-
mination. The Administrator, or an authorized representative, will issue a determination
Page 7 of 16 HUD-52531-B (12188)
ref Handbook 7420 8
a~
within the 30 days of receipt and so advise or its designee or will notify HUD or its
designee within .30-day period that additional time is necessary. (Approved by the Office
ofManagement and Budget under OMB Control Number 1215-0140).
(D) The wage rate (including fringe benefits where appropriate) determined pursuant to
subparagraphs (1)(B) or (C) of this paragraph, shall be paid to all workers performing
work in the classification under this contract from the first day on which work is per-
formed in the classification.
(iii) Whenever the minimum wage rate prescribed in the contract for a class of laborers or
mechanics includes a fringe benefit which is not expressed as an hourly rate, the contrac-
tor shall either pay the benefit as stated in the wage determinations or shad pay another
bona fide fringe benefit or an hourly cash equivalent thereof.
(iv) If the contractor does not make payments to a trustee or other third person, the contrac-
tormay consider as part of the wages of any laborer or mechanic the amount of any
costs reasonably anticipated in providing bona fide fringe benefits under a plan or'
program, Provided, That the Secretary of Labor has found, upon the written request of
the contractor, that the applicable standards of the Davis-Bacon Act have been met. The
Secretary of Labor may require the contractor to set aside in a separate account assets
for the meeting of obligations under the plan or program. (Approve d by the Office of
Management and Budget under OMB Confrol Number 1215-0140).
(2) Withholdine. HUD or its designee shad upon its own action or upon written request of an
authorized representative of the Department of Labor withhold or cause to be withheld from the
contractors under this contract or any other Federal contract with the same prime contractor, or
any other Federally-assisted contract subject to Davis-Bacon prevailing wage requirements,
which is held by the same prime contractor so much of the accrued payments or advances as may
be considered necessary to pay laborers and mechanics, including apprentices, trainees and
helpers, employed by the contractor or any subcontractor the fun amount of wages required by
the contract. In the event of failure to pay any laborer or mechanic, including any apprentice,
trainee or helper, employed or working on the site of the work (or under the United States
Housing Act of 19.37 or under the Housing Act of 1949 in the construction or development of the
project), all or part of the wages required by the contract, HUD or its designee may, after written
notice to the contractor, sponsor, applicant, or owner, take such action as may be necessary to
cause the suspension of any further payment, advance, or guarantee of funds until such violations
have ceased HUD or its designee may, after written notice to the contractor, disburse such
amounts withheld For and on account of the contractor or
Page 6 of 16 HUD-52537-8 (12/88)
ref. Handbook 7420 8
~~
subcontractor to the respective employees to whom they are due, The Comptroller General shall
make such disbursements in the case of direct Davis-Bacon Art contracts
(3)(i) Payrolls and basic records. Payrolls and basic records relating thereto shall be main-
tained by the contractor during the course of the w ork and preserved for a period of three
years thereafter for all laborers and mechanics working at the site of the work (or under
the United States Housing Act of 1937, or under the Housing Act of 1949, in the con-
struction or development of the project). Such records shalt contain the name, address,
and social security number of each such worker, his or her correct classification, hourly
rates of wages paid (including rates of contributions or costs anticipated for bona fide
fringe benefits or cash equivalents thereof of the types described in the Section 1(b)(2)(B)
of'the Davis-Bacon Act), daily and weekly number of hours worked, deductions made
and actual wages paid. Whenever the Secretary of Labor has found under 29 CFR 5,5
(a)(I)(iv) that the wages of any laborer or mechanic include the amount of any costs
reasonably anticipated in providing benefits under a plan or program described in Section
1(b)(2)(B) of the Davis-Bacon Act, the contractor shall maintain records which show that
the commitment to provide such benefits is enforceable, that the plan or program is
financially responsible, and that the plan or program has been communicated in writing
to the laborers or mechanics affected, and records which show the costs anticipated or the
actual cost incurred in providing such benefits. Contractors employing apprentices or
trainees under approved programs shall maintain written evidence of the registration of
apprenticeship programs and certification of trainee programs, the registration of the
apprentices and trainees, and the ratios and wage rates prescribed in the applicable
progmms. (Approved by the Office of Management and Budget under OMB Control
Numbers 1215-0140 and 1215-0017).
(ii) (A) The contractor shall submit weekly for each week in which any contract work is
performed a copy of all payrolls to HUD or its designee if the agency is a party
to the contract, but if the agency is not such a party, the contractor will submit
the payrolls to the applicant, sponsor, or owner, as the case maybe, for transmis-
sion to HUD or its designee, The payrolls submitted shall set out accurately and
completely all of the information required to be maintained under 29 CFR Part
5 5(a)(3)(i) This information may be submitted in any form desired.. Optional
Form WH-347 is available for this purpose and may be purchased from the
Superintendent of Documents (Federal Stock Number 029-005-00014-I), U.S.
Government Printing Office, Washington, DC 20402. The
Page 9 of 16 HUD-52531-B (12188)
reF Handbook 7420 8
a~
prime contractor is responsible for the submission of copies of payrolls
by all subcontractors. (Approved by the Office of Management and
Budget under OMB Control Number 12150149.)
(B) Each payroll submitted shall be accompanied by a "Statement of Com-
pliance,"signed by the contractor or subcontractor or his or he r agent
who pays or supervises the p ayment of the persons employed under the
contract and shall certify the following:
(I) That the payroll for the payroll period contains the information
required to be maintained under 29 CFR Part 5.5 (a)(3)(i) and
that such information is correct and complete;
(Z) That each laborer or mechanic (including each helper, appren-
tice, and trainee) employed on the contract during the payroll
period has been paid the full weekly wages earned, without
rebate, either directly or indirectly, and that no deductions have
been made either directly or indirectly from the fun wages
earned, other than permissible deductions as set forth in 29 CFR
Part 3;
(3) That each laborer or mechanic has been paid not less than the
applicable wage rates and fringe benefits or cash equivalents for
the classification of work performed, as specified in the appli-
cable wage determination incorporated into the contract..
(C) The weekly submission of a properly executed certification set forth on
the reverse side of Optional Form WH-.347 shall satisfy the requirement
for submission of the "Statement of Compliance" required by paragraph
(a)(.3)(ii)(B) of this section.
(D) The falsification of any of the above certifications may subject the
contractor or subcontractor to civil or criminal prosecution under Section
1001 of Title 18 and Section 231 of Title 31 of the United States Code.
Page 10 of 16 HUD-52531-B (12/66)
ref Handbook 7420.6
~~
(iii) The contractor or subcontractor shall make fhe records required under paragraph
(a)(3(i) of this section available for inspection, copying, or transcription by
authorized representatives of HUD or its designee or the Department of Labor,
and shall permit such representatives to interview employees during working
hours on the job.. If the contractor or subcontractor fails to submit the required
records or to make them available, HUD or' its designee may, after written notice
to the contractor, sponsor, applicant, or owner, take such action as may be
necessary to cause the suspension of any further payment, advance, or guarantee
of funds, Furthermore, failure to submit the required records upon request or to
make such records available may be grounds for debarment action pursuant to 29
CFR, Part 5,12.
(4)(i) Apprentices and Trainees. Apprentices. Apprentices will be permitted to work
at less than the predetermined rate for the work they performed when they are
employed pursuant to and individually registered in a bona fide apprenticeship
program registered with the U.S. Department of Labor, Employment and Train-
ing Administration, Bureau of Apprenticeship and Training, or with a State
Apprenticeship Agency recognized by the Bureau, or if a person is employed in
his or her first 90 days of'probationary employment as an apprentice in such an
apprenticeship program, who is not individually registered in the program, but
who has been certified by the Bureau of Apprenticeship and Training or a State
Apprenticeship Agency (where appropriate) to be eligible for probationary
employment as an apprentice. The allowable ratio of apprentices to,joumeymen
on thejob site in any craft classification shall not be greater than the ratio
permitted to the contractor as to the entire work force under the registered
program. Any worker listed on a payroll at an apprentice wage rate, who is not
registered or otherwise employed as stated above, shall be paid not less than the
applicable wage rate on the wage determination for the classification of work
actually performed. In addition, any apprentice performing work on the job site
in excess of the ratio permitted under the registered progmm shall be paid not
less than the applicable wage rate on the wage determination for the work
actually performed. Where a contractor is performing construction on a project
in a locality other than that in which its program is registered, the ratios and
wage rates (expressed in percentages of the journeymen's hourly rate) specified
in the contractor's or subconhactor's registered program shall be observed,
Every apprentice must be paid at not less than the rate specified in the registered
program for the apprentice's level of progress, expressed as a percentage of the
journeymen hourly rate specified in the applicable wage determination. Appren-
tices shall be paid hinge benefits in accordance with the provisions of the appren-
ticeship progmm. If the apprenticeship program does not specify fringe benefits,
apprentices must be paid the Full amount of fringe benefits listed on the wage
Page 71 of i6 HUD-52531-B (12/88)
re! Handbook 7420.8
31
determination for the applicable classification, If the Administrator determines
that a different practice prevails for the applicable apprentice classification,
fringes shall be paid in accordance with that deternination. In the event the
Bureau of Apprenticeship and Training, or a State Apprenticeship Agency
recognized by the Bureau, withdraws approval of an apprenticeship program, the
contractor will no longer be permitted to utilize apprentices at less than the
applicable predetermined rate for the work performed until an acceptable pro-
gram is approved.
(ii) Trainees. Except as provided in 29 CFR 5..16, trainees will not be permitted to
work at less than the predetermined rate for the work performed unless they are
employed pursuant to and individually registered in a program which has re-
ceived prior approval, evidenced by formal certification by the U.S. Department
of Labor, Employment and Training Administration. The ratio of trainees to
journeymen on the,job site shall not be greater than permitted under the plan
approved by the Employment and Training Administration, Every trainee must
be paid at not less than the rate specified in the approved program for the
trainee's level of progress, expressed as a percentage of the journeyman hourly
rate specified in the applicable wage determination. Trainees shall be paid fringe
benefits in accordance with the provisions of th e trainee program. If the trainee
program does not mention fringe benefits, trainees shall be paid the full amount
of fringe benefits listed on the wage determination unless the Administrator of
the Wage and Hour Division determines that there is an apprenticeship program
associated with the corresponding journeyman wage rate on the wage determina-
tion which provides for less than full fringe benefits for apprentices. Any
employee listed on the payroll at a trainee rate who is not registered and partici-
pating in a training plan approved by the Employment and Training Administra-
tion shall be paid not less than the applicable wage rate on the wage determina-
tion for the classification of work actually performed. In addition, any trainee
performing work on the job site in excess of the ratio permitted under the regis-
tered program shall be paid not less than the applicable wage rate on the wage
determination for the work actually performed. In the event the Employment
and Training Administration withdraws approval of'a program, the contractor
will no longer be permitted to utilize trainees at less than the applicable predeter-
mined rate for the work performed until an acceptable program is approved..
(iii) Equal employment opportunity, The utilization of apprentices, trainees and
journeymen under this part shall be in conformity with the equal employment
opportunity requirements of Executive Order 11246, as amended, and 29 CPR,
Part 30.
Page 12 of i6 HUD-52531-B (12/88)
ref Handbook 7420.8
~~
(5) Compliance with Copeland Act requirements. The contractor shall
comply with the requirements of 29 CFR, Part .3 which are incorporated
by reference in this contract.
(6) Subcontracts. The contractor or subcontractor will insert in any subcon-
tracts the clauses contained in Section 2.4(a)(I) through (10) and such
other clauses as HUD or its designee may by appropriate instructions
require, and also a clause requiring the subcontractors to include these
clauses in any lower tier subcontracts. The prime contractor shall be
responsible for the compliance by any subcontractor or lower tier
subcontractor with all the contract clauses in this Section 2,4(a).
(7) Contract terminations: debarment A breach of the contract clauses in 29
CFR, 5.5 may be grounds for termination ofthe contract, and for debar-
ment as a contractor and a subcontractor as provided in 29 CFR, 5..12.
(8) Compliance with Davis-Bacon and Related Act Re~rements. All
mlings and interpretations of the Davis-Bacon and related Acts con-
tained in 29 CFR, Parts 1, 3, and 5 are herein incorporated by reference
in this contract.
(9) Disputes concerning labor standards. Disputes arising out of the labor
standards provisions of this contract shall not be subject to the general
disputes clause of'this contract. Such disputes shall be resolved in
accordance with the procedures of the Department of Labor set forth in
29 CFR, Parts 5, 6, and 7. Disputes within the meaning of this clause
include disputes between the contractor (or any of its subcontractors) and
HUD or its designee, the U. S Depa rtment of Labor, or the employees or
their representatives.
(10) (i) Certification of Eli ibg ilit_y. By entering into this contract, the
contractor certifies that neither it (nor he or she) nor any person
or firm who has an interest in the contractor's firm is a person or'
firm ineligible to be awarded Government contracts by virtue of
Section .3(a) of the Davis-Bacon Act or 29 CFR 5.12(a)(I) or to
be awarded HUD contracts or participate in HUD programs
pursuant to 24 CFR, Part 24.
Page 13 of 16 HUD-52531-B (12/88)
ref Handbook 7420 8
(ii) No part of this contract shall be subcontracted to any person or
firm ineligible for award of a Government contract by virtue of
Section .3(a) of the Davis-Bacon Act or 29 CFR 5,12(a)(I) or to
be awarded HUD contracts or participate in HUD programs
pursuant to 24 CFR Part 24.
(iii) The penalty for making false statements is prescribed in the U.S.
Criminal Code, 18 U S. C IOOI Additionally, U.S. Criminal
Code, Section 1010, Title 18, U.S.C., "Federal Housing Admin-
istration transactions, provides in part: "Whoever, for the
purpose of ._influencing in any way the action of such
Administration _makes, utters or publishes any statement,
knowing the same to be false... shall be fined not more than
$5,000 or imprisoned not more than two years, or both."
(b) Contract Work Hours and Safety Standards Act, As used in this para-
graph, the terms "laborers" and "mechanics" include watchmen and
guards.
(I) Overtime requirements.. No contractor or subcontractor con-
tracting for any part of the contract work which may require or
involve the employment of laborers or mechanics shall require
or permit any such laborer or mechanic in any workweek in
which he or she is employed on such work to work in excess of
Forty hours in such workweek unless such laborer or mechanic
receives compensation at a rate not less than one and one-half
times the basic rate of pay for all hours worked in excess of forty
hours in such workweek,
(2) Violation• li•rbilit~or unpaid wa eg s_liquidated damages In the
event of any violation of the clause set forth in subparagraph (1)
of this paragraph, the contractor and any subcontractor respon-
sible therefore shall be liable for the unpaid wages. In addition,
such contractor and subcontractor shall be liable to the United
States (in the case of work done under contract for the Disfrict of
Columbia or a territory, to such District or to such territory), for
liquidated damages.. Such liquidated damages shall be computed
with respect to each individual laborer or mechanic, including
watchmen and
Page 14 of 16 HUD-52531-8 (12168)
ref. Handbook 7420 6
~~
guards, employed in violation of the clause set forth in subpara-
graph (1) of this paragraph, in the sum of $] 0 for each calendar
day on which such individual was required or peanitted to work
in excess of the standard workweek of forty hours without
payment of the overtime wages required by the clause set forth
in subparagraph (I) of this paragraph.
(.3) Withholdine for undid wages and liquidated damages. HUD or
its designee shall upon its own action or upon written request of
an authorized representative of the Department of Labor with-
hold or cause to be withheld, from any monies payable on
account of work performed by the contractor or subcontractor
under any such contractor any other Federal contract with the
same prime contractor, or any other Federally-assisted contract
subject to the Contract Work Hours and Safety Standards Act,
which is held by the same prime contractor such sums as may be
determined to be necessary to satisfy any liabilities of such
contractor or subcontractor for unpaid wages and liquidated
damages as provided in the clause set forth in subparagraph (2)
of this paragraph,
(4) Subcontractors, The contractor or subcontractor shall insert in
any subcontracts the clauses set forth in subparagraph (1)
through (4) of this paragraph and also a clause requiring the
subcontractors to include these clauses in any lower tier subcon-
tracts, The prime contractor shall be responsible for compliance
by any subcontractor or lower tier subcontractor with the clauses
set forth in subparagraphs (I) through (4) of this paragraph.
2.5-2.7 RESERVED.
2.8 WAGE CLAIMS AND AD.IUSTMENTS,
The Owner shall be responsible for the correction of all violations under Section 2.4, including
violations committed by other contractors. In cases where there is evidence of underpayment of
salaries or wages to any laborers or mechanics (including apprentices and trainees) by the Owner
or other contractor or a failure by the Owner or other contractor to submit payrolls and related
reports, the Owner shall be required to place an amount in escrow, as determined by HUD
sufficient to pay persons employed on the work covered by the Agreement the difference be-
tween the salaries or wages actually paid such employees for the total number of hours worked
and the full amount of wages required under this Agreement, as well as an amount determined by
HUD to be sufficient
Page 15 of 76 HUD-52531-B (72/66)
ref. Handbook 7420 B
~~. C~
to satisfy any liability of the Owner or other contractor for liquidated damages pursuant to
Section Z.4, The amounts withheld may be disbursed by HUD for and on account of the Owner or
other contractor to the respective employees to whom they are due, and to the Federal Govern-
ment in satisfaction of liquidated damages under Section 2 4.
2.9 RESERVED.
2.10 EVIDENCE OF UNIT(S) COMPLET[ON; ESCROW,
(a) The Owner shall evidence the completion of the unit(s) by famishing the PHA in addi-
tion to the requirements listed in Section 1.6 of this Agreement, a certification of compli-
ance with the provisions of Sections 2.4 and 2.8 of this Agreement, and that to the best of
the Owner's knowledge and belief there are no claims of underpayment to laborers or
mechanics in alleged violation of these provisions of the Agreement. In the event there
are any such pending claims to the know ledge of the Owner, the PHA, or HUD, the
Owner will place a sufficient amount in escrow, as directe d by the PHA or HUD, to
assure such payments.
(b) The escrows required under Sections 2.8 and 2.10 shall be paid to HUD, as escrowee, or
to an escrowee designated by HUD, and the conditions and manner of releasing such
escrows shall be designated and approved by HUD,
2.11 FLOOD INSURANCE.
If the project is located in an area that has been identified by the Federal Emergency Manage-
ment Agency as an area having special flood hazards and if the sale of flood insurance has been
made available under the National Flood Insurance Program, the Owner agrees that the project
will be covered, during its anticipated economic or useful life, by flood insurance in an amount at
least equal to its development or project cost (less estimate d land cost) or to the limit of coverage
made available with respect to the particular type of property under the National Flood Insurance
Act of 1968, whichever is less.
Page 16 of i6 HUD-52531-B (12/88)
ref Handbook 7420.6