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Home My WebLink AboutContracts & Agreements_73-2011_CCv0001.pdf SRF11 X103 Construction Loan/Croat Agreement No. 'SRF 11C 1 03 STATE OF CALIFORNIA HEALTH AND HUMAN SERVICES AGENCY` DEPARTMENT OF PUBLIC HEALTH FUNDING AGREEMENT BETWEEN STATE OF CALIFORNIA DEPARTMENT OF PUBLIC HEALTH AND CITY OF REDLANDS �� k -gals` PROJECT NUMBER: 3610037-004 V 90 VS, FOR A CONSTRUCTION LOAN AND GRANT UNDER THE SAFE DRINKING WATER STATE REVOLVING FUND LAW OF 1997' (Rev. 5/4/11 SRF11CX103 TABLE OF CONTENTS � [�_ Section_ = ge 1[ Purpose °^° ........~-...~_,~°_~~-~,.,^--_` ...................-^-----......~~^ 1 2- Incorporation ..... ~ ............. `--......~--............,^_~' 2 1 Project Cost , ............ .............................. ......-..~..-....... .........~~-~_.~,-,~~__~__ 2 4, LoanAmount ".°,.^^.^~^...,^,^,''''-...^'^.---.-^~^-^,_,^--^^'^_^.^^..-,^~.^ ........... 2 5� Grant Amount.~.__=.` ^----^-=^ ...................... -----==~_-"~°-~--- ............. 2 6_ Supplier's Cost''_',,~'~~~____^~,^~,~~,,^,,~,_^,`__'__,^~,~~^,......',,...... .~.....�.___ �� 7 Competitive- ^.,^..^`'__.-^^.'^'-~-^^^^^^~--__-~.-".^^^~^~_~ ........ ...... 3 8. Requirements for Disbursement'~,~==-~~-=,_.~^-=~_.°.~~_-~~.-~--^.~~-.._~~-~~- 3 9. Rate of 'Interest ........................................................................ ........ .- ...... ......... 3 10. Loan RepaymentTerm ^~,~^......... ...... _-,-_.. .................__......... ~,~' ...... ......... 3 11, Special Requirements..................................................................... '`-'~-'-~~^~^~-� -�� 12. Operation and Maintenance of Project-....-...................... .~~ ....... -~-.......... --.... 4 13and Deposit Account Control Am _~,~,~___=._'=,_^ 4 14^ ~.°~~~~----... .....................-.-.-~ ..... .................... 41 - -' ^ '^.^^_`__'-,'^.~~-_-~^-a~_-.,�`~.`,'°',`-'-~-_~ 6 16. Miscellaneous Provisions................-....-......."~ ............''==.'=__-=-'='= 6 EXHIBIT"B[l[A STANDARD CONDITIONS Article Page A- 1[ Definitions _^.'-_--, ......... 9 A-2^ Term of -......................... .........._-........~-.°.~~~~_~~~~._~~~,_-.._ 10 SRF11CXt08 TABLE OF CONTENTS (continued) ~ ^Article Page� A- 4. Compliance with Laws, Regulations, and -.Permit Requirements-.._ ......... 11 A~ 5. Project Changes _^,°___,_,~,, ____._,_ ........... 11 Ar6� ........ ....... 11 Claims'__',,,__,_,`...................~^,°`,~,,_,,,^,,_~,~,_~,,__`,,_,,`_,_~_ ................. 11 -t__-._.... ~--`- ............ "°,~=~_, ...... ........ 11 (c) Rejection of Claims .........~........ ,_~................................................. .__--.... Correction.^`*" Claims -.'-_^......................................^'-...... ....................... ,"_ ..~~_. ........... _.~~~.~-^~` ... .~_. Final_ i�� ..-~_.._.-^_.~~.~.--.----..~.,.--~-----'- �3 � ^ 13r=, r-�/w�^��m/'�--_--.-_--...~-~.__-'~.-_._,, ~',,~__-^~-^-`_~_-----_~` A- 7. Withholding of Loan and Grant Disbursements by State and Cancellation ....... 3 (b) Withholding Entire Loan andGrant .......... ..----._.,-_._............__. 14 (c) Withholding Balance of LoanandGrant ..........................'......._^ 14 A- 8. Timing ~," �_^`=.`'=--=-.~~`=-~...... `='-=^--""-^~=~=~ 14� A-9' ...............'_~`'~_........ _ ......................... ..............~.._-.-~..... 14 Audit and Inspection of Books and .---......... ~. 15� A-1 1� 15 (a) Transmission of Statement to Supplier....~. ..........................__...........~ 15 (b) _.-^^~.'---`,~~~~°. ~`~_..-..~,.--_.`-_,,~- 15� A-12, _.____`,.............. .......�_...--~ 16� A-11 16 (a) Terms of _,~,^,',_,_~.~~~__~,,.~~.,__~___,_~_~__, 16; (b) — ......__. .........- .-~ ........__-_. 16 A-14, Payment Delinquency__ ............... ...-. ............. __" 17 A,15� *�` .' (a) Separate Accounting of Disbursements and Interest; Records .......~...........' 17 (b) Disposition of Funds ~ . (m) Interim and Final Audits. ,,,......______,...............__ ..........,---~......______...... 17' SRF11CX10@ TABLE OF CONTENTS Article Page 6' ` - Sƒafe -_.-_~._~~~~.-...._~,~..^--..--_-.~~..~._~_.-_-__ 18� . . ' A-17. Prohibition Against Disposal of Project Without State Permission.~__�_-,_......... 18� A_1]8. Nondiscrimination Clause=..--=.-~-.._-~..".._.~.~~,~~~^~'-~-~~~^~'-~~--^`-`- 18� - 19. .....................~.^.....-~~~.~~~--``~,--~--__._= .... 19� A-20. Successors and __ ............. 19� � A+21, State to be Held Harmless ............................. -.....................-~^-~^~-`~-~~~~-^~'- �� ' -- A~22, Remedies_ Not Exclusive `~_.___,,,_,........................... `, ........ ...... .......... .,_~^ 20| A_21 Amendments.._.___.__~=_s____`_ ........ ...........................................=°"^~....~"==,_. 2w0 Ae24. Waiver of ` .~.-.~-............ ............--....... .--~.. ........ ........___....... ..^........ 20A-25. Dispute Clause. -- ........_.......,... ._~,"_^=_,,=_,......._. ..............~_.................... 20A-26. Performance � and -.=.--~~-.-..~=°~~^.~~-.~^'~^~-~`-- 20A-27. Default Provisions. � .................................. ....... _........ ......... ...... _- 21 A_2& Drug-Free ............^ ......--......... ........ ........,.......... 22� A-29. Conflict of and ................... 23� A-30" Additional wInsured....................... .............. ...........................'^^,--._'-^^ "23 A_31. Prohibited Use of State Funds for ............. ....., ........ 23 A-32. Labor | ^°.�,.........-`.'.......... ~-"..=^.`"~~.^-`.`-'^~^`^-^.'``-'`~`'`^'^^^ 23� ' 31. Davis-Bacon 0ce........ ~_^~~.,_,-._........+~.`~....... ,.-^.............. 24 New Restrictions on 24� ^`35. Single Audit Act ^^_===.^__~...... ......`=....... .......___..........'~..... ~_ ` A-36. Additional Reporting.. .............. . 25 A-37- Data -25 - SRFIICX103 TABLE OF CONTENTS (continued) EXHIBIT B SECURITY REQUIREMENTS Article Page KB- 1L ......_.-...... ............... ........ ^__^ __"-~,~, 26 B- 2Rates and Charges~~~~~~-~-~~-.-.-~~.-.''-~~`~-----..--~~--^_~~~^~.~..~~-.~-~~~ 26 BL3. Security ................. ,.-,^--.__,.......,°,^-............. ~............~_..................... 26� B- 4. Fund ......................_.................... .............................`.~~~.--.~.^._--_......^ 26� B~5' � ~---~----~.--'~-.-.-.~~_'-~.~.~~~-.~~~~~.-~---.`.~..~_~-_~ �� _'~^~^~ ` Legal Obligation _- -` SEXHIBIT C PECIAL REQUIREMENTS C- 1, -Security...... ...... ...... ............ ................................ ...... ............ 28� C-2. Additional Requirements-.__~_~.___~ .,_~,,,~=,,_ ........................ 28� EXHIBIT D COMPLIANCE WITH DAVIS BACON D- 1, ~,~~`^, ,,_,~__^_~~,~~,`,_~___,_,_._,_~_,._,_ ___'__ 30 EXHIBIT E NEW RESTRICTIONS ON LOBBYING E-1. New Restrictions on Lobbying ......... ~-~'^~`~__-..~°,`^~._~,~-.~-,..~~_.--- ........ 31 EXH|BITFF COMPLIANCE WITH CROSS-CUTTING FEDERAL AUTHORITIES — 1. Compliance- —. .__....... ......... 42 F- 2. Equal Employment Opportunity-- _ ......^^,~_......... ....+_.......... 43 pr~3. Participation of ='__°^_,=_,=__�_ 45 F- 4. ~~_,__~~~_~,~,___~',,~~~__',~,~~,,_,~^,~~,,____~,__~ 46 SRF11CX103 TABLE OF CONTENTS (continued) Article Page F- 5. Debarment and Suspension ................................................................................... 46 F- 6. Uniform Relocation and Real Property Acquisition Act........................................... 48 ATTACHMENTS Attachment 1. Fiscal Services and 13) Attachment 2. Deposit- Account Maintenance Agreement- � - - r ` Ar3(d)) Attachment 3. Initial Budget Summary (Article A-3(f)) Attachment ~ , ._._ .^ Claim for -^~~-`~-'--'-- Funds Attachment 5. Final --(Article— -r,~,, _ Attachment 6. `Supplier's Certification of Project Completion (Article A-8(b)) Attachment 7. 'Davis-Bacon Wage Provisions (Article A-33) Attachment 8. Minority Business Enterprise —Women's Business Enterprise Goals for Participation (Article F-3(a)) Attachment 9. Disadvantaged ~Business Enterprise Information Form F-3(b)) Attachment 10. Example DBE/MBE/WBE Bid Solicitation (Article F-3(e)) Attachment 11` BiddersList Page I of 48 SRF11C 103 STATE OF CALIFORNIA HEALTH ANIS HUMAN SERVICES AGENCY DEPARTMENT OF PUBLIC HEALTH FUNDING AGREEMENT BETWEEN STATE OF CALIFORNIA [DEPARTMENT OF PUBLIC HEALTH AND CITY OF REDLANDS PROJECT NUMBER; 1007-404 UNDER THE SAFE DRINKING WATER STATE REVOLVING FUND LAW OF 1997 THIS FUNDING AGREEMENT (this "Agreement") is entered into by and between the State of California Department of Public Health ("State") and City of Redlands, a public agency, in the County of Sari Bernardino, State of California" daily organized, existing, and acting pursuant to the laws thereof, ("Supplier"), which parties do hereby agree as follows: SECTION 1.. PURPOSE OF FUNDING This Agreement constitutes finding in the form of a loan and a grant rade by State to Supplier under the provisions of California Safe Drinking Water Stag Revolving Fund Law of 1997, Fart 12" Chapter 4.5 (commencing with Section 116760), of Division 104 of Health and Safety Code. The purpose of the Banding is to assist in financing construction of a project which will enable Supplier to meet safe drinking water standards established pursuant to Part 12; Chapter 4 (commencing with Section 116270), of Division 104 of the Health and Safety Code and California Code of Regulations, Title 22, or to address ether health concerns (the "Project"). Funds may be used only for such eligible project costs as are approved by State. This Agreement also constitutes a secured promissory note for Supplier's repayment of the loan.. Supplier is solely responsible for the design, construction, operation, and maintenance of the Project; and for all persons or entities engaged in such work, including but not limited to contractors, subcontractors, suppliers, and providers of services. Review or approval of plans, specifications, bid documents, or other construction documents by State is solely for the purpose of proper administration of the loan funds by State and shall not be deemed to relieve or restrict Supplier's responsibility. Page 2 of 48 SRF1 1 CX103 SECTION 2. INCORPORATION OF OTHER DOCUMENTS This Agreement incorporates by this reference all attachments to this Agreement, Exhibit "A", "Standard Conditions"; Exhibit "B", "Security Requirements"; Exhibit "C", "Special Requirements"; Exhibit "D", "Compliance with Davis-Bacon"; Exhibit "E", "New Restrictions on Lobbying"; Exhibit "IF", "Compliance with Cross-cutting Federal Authorities"; Supplier's "Application For Construction Funds"; project plans and specifications as submitted to and approved by State; and any attachments to said documents. Supplier accepts and agrees to comply with all terms, provisions, conditions, and commitments of this Agreement, including all incorporated documents and exhibits thereto, and to fulfill all assurances, declarations, representations, and statements made by Supplier in its application, documents, amendments, and communications filed in support of its request for Safe Drinking Water State Revolving Fund financing, including but not limited to any and all plans and specifications submitted to and approved by State. SECTION 3. PROJECT COST Supplier represents that the total cost of the Project is estimated to be $14,060,958 (the "Project Cost") of which State agrees that $13,663,033 is eligible for Safe Drinking Water State Revolving Fund financing. SECTION 4. LOAN AMOUNT Pursuant to the Safe Drinking Water State Revolving Fund Law of 1997, its applicable rules and regulations, and subject to the availability of funds, State will lend to Supplier in accordance with the terms of this Agreement an amount not to exceed $1,3,663,033 (the "Loan"). For valuable consideration, Supplier agrees to repay State the Principal Amount of the Loan (as defined in Article A-1, hereof) together with interest, Delinquent Interest (as defined in Article A-14, hereof) and other fees and costs due thereon in accordance with terms and conditions of this Agreement. Supplier's promise to pay as set forth in this paragraph, shall survive termination of this Agreement for any reason including but not limited to operation of law. SECTION 5. GRANT AMOUNT Pursuant to the Safe Drinking Water State Revolving Fund Law of 1997, its applicable rules and regulations, and subject to the availability of funds, State will provide grant funding to Supplier in accordance with the terms of this Agreement in an amount not to exceed $,0 (zero,J_(the "Grant", with the Loan and the Grant hereinafter collectively referred to as, the "Funding"). Page 3 of 43 SRF11CX103 SECTION 6. SUPPLIER'S COST Supplier agrees to fund any portion of the Project Cost which is in excess of the Funding. Supplier's cast for this Project is estimated to be $397,925, ("Supplier's Cost"). Unless otherwise set forth in Exhibit "C" to this Agreement, "Special Requirements", such Supplier's Cost shall be expended prior to the expenditure of State loan funds unless such Supplier's Cost is funded by other State or Federal Agencies, in which case funds shall be drawn on a pro-rata basis. SECTION 7. COMPETITIVE BIDDING All construction contracts related in any way to the Project shall be let by competitive bid procedures which assure award of such contracts to the lowest' responsible bidders. Supplier shall adhere to any applicable state or local ordinance for competitive bidding and applicable labor laws. Supplier shall not award a construction contract until a summary of bids and identification of the selected lowest responsible bidder is submitted to and approved in writing by State. A full explanation must be provided if Supplier is proposing to award a construction contract to anyone ether than the lowest responsible bidder. SECTION 8. REQUIREMENTS FOR DISBURSEMENT Not later than sixty 0) days following the bate of Execution (as defined in Section fib, hereof), Supplier shall satisfy all conditions precedent to the disbursement of the Funding, including Basic Conditions Precedent as set forth in Article A-S, hereof. Failure by Supplier to satisfy said conditions and requirements by this date may, at the option of State, result in cancellation of this agreement under Article -7; hereof. SECTION g. RATE OF INTEREST The rate of interest to be paid by Supplier on the Principal Amount of the Loan shall be 2,5017 percent per annum (the "Rate of Interest")• Interest shall begin to accrue as of the date of each Disbursement (as defined in Article A- (b) hereof) of the Loan. SECTION 10. LOAN REPAYMENT TERM The Loan has a repayment term of 20 years (the "Loan Repayment Term"). SECTION 11. SPECIAL REQUIREMENTS Supplier shall satisfy the special requirements set forth in Exhibit "Cfr". Failure by Supplier to timely satisfy the special requirements and conditions may, at the option of Page 4 of 4 State, result in cancellation of this Agreement under Article A-7, hereof, or declaration that Supplier is in default pursuant to ,Article A-27, hereof. SECTION 12. OPERATION AND MAINTENANCE OF PROJECT Upon project completion and for a period of 20 gears, which is the reasonably expected useful life of the Project, Supplier shall, as further consideration for the Funding,commence and continue operation of the Project; shall cause the Project to be operated in an efficient and economical manner; shall provide for the making of all repairs, renewals, and replacements necessary for the effective operation of the Project; and shall cause the Project to be maintained in as good of condition as upon its construction, ordinary and reasonable wear and depreciation excepted. Failure b Supplier to operate and maintain the Project in accordance with this provision may, at the option of State, be considered a material breach of this Agreement and may be treated as a default under Article A- 7, hereof. SECTION 13. FISCAL SERVICES AND DEPOSIT ACCOUNT CONTROL AGREEMENT Supplier shall enter into a fiscal services agreement with a Fiscal Agent substantially in the farm of Attachment 1 to this Agreement (the "Fiscal Services and Deposit Account Control Agreement"). A Fiscal Agent shall be retained until all amounts due to State under the terms of this Agreement have been paid in full. Supplier shall open a separate deposit account (the "deposit Account")with the Fiscal Agent, in which Supplier shall maintain funds, including the Deserve Fund (as defined in Article B-4, hereof), sufficient to service the Loan. Funds from the Deposit Account shall be used only for payment of principal and/or interest on the Loan, or any delinquencies thereon, until the Lean is repaid in full. Once State approves the FiscalServices and Deposit Account Control Agreement, Supplier shall not do any of the following without first obtaining written approval by State: amend the Fiscal Services and Deposit Account Control Agreement; close the Deposit Account; or retain a new Fiscal Agent. State shall have no obligation to make Disbursements as defined in Article A` (b), hereof) until the Fiscal Agent has been engaged and the Fiscal Services and Deposit Account Control Agreement between Supplier and the Fiscal Agent has been approved by State. SECTION N 14. PROJECT OFFICIALS AND NOTICES State's Contract Manager shall be the Chief, Drinking Water Technical Programs Branch, Division of Drinking Water and Environmental Management, California Department of Public Health.. Page 5 of 48 SRF11CX103 State's Contract Manager shall be its representative frau administration of this Agreement, and shall have authority to make recommendations and findings with respect to each controversy arising under or in connection with this Agreement, including but not limited to, the interpretation, performance, or payment for wort performed under this Agreement. All such recommendations and findings shall be communicated to the Chief; Division of Drinking Water and Environmental Management of the California Department of public Health (the "Chief"), and disputes shall be resolved in accordance with Article A-25, hereof. Supplier's Contract Manager shall be its Water Resources Manager. Supplier's Contract Manager shall be its representative for administration of this Agreement. All communications given to Supplier's Contract Manager shall be deemed given to Supplier and shall be binding on Supplier. Either party may change its Contract Manager upon written notice to the other party. Notices required to be given in writing by Supplier to ;tate under this Agreement sharp be sent to: State of California Department of public Health Division of Drinking Water and Environmental Management Safe Drinking Water State Revolving Fuad Program Attn: Chief, Drinking Water Technical Programs Branch 1616 Capitol Avenue, MS 7418 Post Office Boat 907377 Sacramento, CA 95899-7377 Notices required to be given in writing by State to Supplier under this Agreement: shall be sent to; City of Redlands Atte:-Water Resources Manager 36 Cajon Street, Suite 15A P.O. Box 3006 Redlands, CA 02373 A change of address for delivery of notice may be mare by either party by written notice of such change of address to the other party. All written notices that are required either expressly or by implications to be given by one party to the other under this Agreement shall be signed for State by its Contract Manager and for Supplier by its Contract Manager. Except as otherwise expressly required by this Agreement, all such notices shall be deemed to have been given if Page 6 of 4 SRF I I CX 1 delivered personally or if enclosed in a properly addressed postage prepaid envelope and deposited in a united States Feast Office for delivery by registered or certified mail. SECTION 15. ENFORCEMENT ENS" Any enforcement action, arising out of or relating to this Agreement may be brought by State or any agent thereof. SECTION 16. MISCELLANEOUS ELLTANEOUS PROVISION S ATTORNEY FEES In the event either party commences an action or proceeding concerning the subject matter of this Agreement, the prevailing party in such action or proceeding shall be entitled to recover reasonable attorney fees incurred therein, SEVERABILITY If any provision of this Agreement is held invalid or unenforceable by any court of final jurisdiction, it is the intent of the parties that all other previsions of this Agreement be construed to remain fully valid, enforceable, and binding on the parties. GOVERNING LAW This Agreement is governed by and shall be interpreted in accordance with the lags of the State of California. CHILD SUPPORT COMPLIANCE ACT Supplier acknowledges that it is the policy of this state that anyone who enters into a contract with a state agency shall recognize the importance of child and family support obligations and shall fully comply with all applicable state and federallaws relating to child and family support enforcement, including, but not limited to, disclosure of information and compliance with earnings assignment orders, as provided in Chapter (commencing with Section gg) of Dart 5 of Division g of the Family Code, Supplier further acknowledges that to the best of its knowledge it is fully complying with the earnings assignment orders of all employees and is providing the names of all new employees to the New Hire Registry maintained by the Employment Development Department. FEDERAL. FINANCIAL. ASSISTANCE Supplier acknowledges that the source of funds disburses! to Supplier by State under this Agreement includes federal financial assistance, and Supplier agrees to comply with all applicable>Cross-cutting Federal Authorities including those listed in Exhibit `' " to this Agreement, and provisions of the Single Audit Act as set forth in the Federal Office of Management and Budget M Circular A-1 33, Page 7 of 48 I F11CX10 LEGAL CAPACITY Supplier hereby warrants and represents that it is a legal entity in good standing, and that it has the authority to enter into this Agreement and to incur the indebtedness described herein. Supplier shall notify° State as promptly as feasible of any proposed change in Supplier's ownership, organization, legal form or service area.. VENUE The parties agree that venue of any action between the parties arising out of this Agreement, including disputes that may arise following termination of the Agreement, shall be County of Sacramento, State of California. DATE OF EXECUTION "Date of Execution" of this Agreement shall be the date of the latest in time execution by a party hereto. Signatures appear on following page.]' Page 8 of 48 SRF11CX103 IN WITNESS WHEREOF, the parties hereto have executed this Agreement SUPPLIER: STATE: CITY OF REDLANDS STATE OF CALIFORNIA DEPARTMENT OF PUBLIC HEALTH ATTEST* s rr By: Name., Pete Aguilar lar 5am T rwin Name: Godniew Title: Mayor Citv Cleric Title: June. 21, 2011 Date: Address: 35 Cajon__Street,, ,,Suite 200 (PO Box 3005 mailing) Redlands CA 92373 m Approvedt, s tf LegalfForrt and Suii4we c .l By: Marne: Title: . t w a Cat Dat : I Page 9 of 4 SR 11CX10 EXHIBIT STANDARD CONDITIONS ARTICLE A-1. DEFINITIONS Whenever in this Agreement the following terms are used, their meaning shall be as fellows unless the context clearly requires otherwise: Agreement or Contract--The Funding Agreement to which this "Exhibit `A' Standard Conditions" is appended. Days--Calendar days unless otherwise expressly indicated. Month--Calendar month unless otherwise expressly indicated: Year--Calendar year unless otherwise expressly indicated. Cross-cutting Federal Authorities--Federal laws and Executive Orders that apply in federal financial assistance programs, or to projects and activities receiving federal financial assistance, regardless of whether the statute authorizing the assistance makes them applicable. They are sometimes referred to as "cross-cutters" Eligible Project Costs--Those project costs which are eligible for funding under applicable State and Federal law. Fiscal Agent - bunk., which includes savings banks, savings and loan associations, credit unions and trust companies, or any other financial institution or entity approved by State responsible for funds deposited for the repayment of all amounts due to Mate under the terms of this Agreement. Force Account--The use of Supplier's own employees or equipment, for planning, engineering, design, construction or construction related activities on the Project Grant Arnount-- The aggregate amount of the Grant disbursed to Supplier under this Agreement. The Grant Amount is characterized as a subsidized loan principal; amount, as authorized by 42 U.S.C, 00j-12tdj, is not intended and shall not be characterized as a federal subgrant. Principal Amount of the Loan --The total amount disbursed to Supplier under this Agreement less any Grant Amount disbursed and any amount of such total amount disbursed that may have been repaid or remitted to Mate by Supplier; Project Completion Date--The date that is determined by Article A-8, hereof. Page 10 of 4 Rr=11 C10 Public Water System or Public Water Supply Sy tem--A system for the provision to the public of water for human consumption, as defined in Part 12, Chapter (commencing with Section 11 270), of Division 104 of the Health and Safety Code, as it may be amended from time to time. ARTICLE A-2. TERM OF AGREEMENT Subject to the provisions of Article A7, this Agreement shall became effective on the Cate of Execution and shall remain in effect until the Principal Amount of the Lean, all interest thereon, and any other suras of money due to State under this Agreement, have been paid in full or until the expiration of the period of time requiredfor operation and;maintenance of the Project, as set forth in Section 12 of this Agreement, whichever shall occur last (the "Term of Agreement"). ARTICLE A-3. BASIC CONDITIONS PRECEDENT State shall have no obligation to disburse the Funding, or any portion thereof, unless and until Supplier has done all of the following., (a) Supplier's governing body has taken action authorizing it to borrow the Loan and to eater into this Agreement, and designating a representative to execute this Agreement and to sign claims for Disbursements (as defined in Article -6(b), hereof); (b) Supplier has dedicated a source of revenue for repayment of the Principal Amount of the Loan plus all interest accrued; (c) Supplier has executed all documents required to provide the security required by Article B- , hereof, (d) Supplier has executed a Deposit Account:Maintenance Agreement substantially in the farm of Attachment 2 to this Agreement; and Supplier has established all accounts required by the Deposit Account Maintenance Agreement; (e) Supplier has engaged the services of a Fiscal Agent and the Fiscal Services and Deposit Account Control Agreement has been Rally executed as required by Section 13 of this Agreement; and (f) Supplier has submitted an initial budget summary to State substantially in the form of Attachment 3 to this Agreement and said initial budget summary has been approved by State. Determination of Supplier's satisfaction of the conditions of this Article A-3 is at the sole discretion of State. Page 11 of 4 SRF11CX10 ARTICLE A-4. COMPLIANCE WITH LAWS, REGULATIONS, AND PERMIT REQUIREMENT Supplier shall at all times comply with, and require its contractors and subcontractors to comply with, all applicable federal and state laws, rules and regulations, permits, and all applicable local ordinances, specifically including, but not limited to environmental, procurement and safety laws; rules; regulations, permits, and ordinances. ARTICLE A-5. PROJECT CHANGES The Project shall be constructed in accordance with the plans and specifications as approved by State on September 8; 2010. Supplier shall not make any change in the project, or issue any change order to a contractor which affects the treatment process, would increase the capacity of any project component, causes a significant change in the location of any project component, or affects the timely completion of the Project, without receiving prior written approval from State. Supplier may request a one-time increase in the Funding. Such request shallbe based upon the final accepted construction bids. Such request may be granted or denied at the sole discretion of State. Supplier shall not use any funds from any contingency allotment without receiving prior written approval from State. ARTICLE A-6. DISBURSEMENTS BY STATE (a) Claims. Supplier shall request disbursement by submitting to State a claim(s) for incurred Eligible Project Costs. A claire for Disbursement (as defined in Article A- (b)):shall be provided in the form of Attachment 4 to this Agreement. A claim shall be submitted no less frequently than quarterly, but no more frequently than once a month; Claim submission shall commence not later than six months following the Date of Execution. Each claim shall include: (1) a statement of Eligible Project Costs that have been incurred for work performed in constructing the project during the period identified in the particular claim, ( ) a statement of Eligible project Casts that have been incurred for the Project during the period identified in the particular claim, including, but not limited to, legal, engineering, and administrative fees associated with the Project; and ( ) copies of invoices=and receipts supporting such statements. (b) Disbursements, Following the review and approval of a claim by State, State will disburse to Supplier an, approved amount, subject to the availability of funds Page 12 of 48 SRF11CX103 (each, a "Disbursement"), All Disbursements, and any and all interest earned by Supplier on the Disbursements, shall be used solely to pay Eligible Project Costs. The Loan shall be disbursed before the Grant is disbursed. (c) Rejection of Claims. State may reject a claim if: (1) It is submitted without signature, (2) It is submitted under signature of a person other than Supplier's duly authorized representative; (3) Supplier fails to timely submit a final claim within the time period specified in Article A-6(f), hereof; (4) Not submitted in accordance with subpart (a) of this Article A-6; or (5) Contains costs incurred after the Project Completion Date (as defined in Article A-8, hereof). State will notify Supplier of any claim so rejected, and the reasons therefore. (d) Correction of Claims. A claim containing a mathematical error will be corrected by State, after telephone notification to Supplier; and will thereafter be treated as if submitted in the corrected amount. State will provide Supplier with notification of the corrected claim. (e) Adjustments to Claims, State will notify Supplier by certified or registered mail, whenever, upon review of a claim, State determines that any portion or portions of the costs claimed: (1) Are ineligible to be financed by the Safe'Drinking Water State Revolving Fund under Federal or State law, or the terms of this Agreement, (2) Do not constitute costs approved by State for financing under the terms of this Agreement; (3) Are not supported by invoices or receipts acceptable to State; or (4) Contains costs incurred after the Project Completion Date (as defined in Article A-8, hereof). Supplier may, within thirty (30) days of the date of receipt of such notice, submit additional documentation to State to cure such deficiency(ies), If Supplier fails to timely submit adequate documentation curing the deficiency(ies), State will adjust the pending claim by the amount of the ineligible and/or unapproved cost(s). Supplier may Page 13 of 48 SRF1 1 CX1 03 continue to submit additional documentation in support of rejected cost(s) and may include such cost(s) with additional supporting documentation on a subsequent claim. (f) Final Claim and Disbursement. Supplier shall submit a final claim not later than six (6) months from the Project Completion Date, as set forth in Article A-8, hereof. In addition to the information required by subpart (a) of this Article A-6, the final claim shall include: (1) A statement of full written disclosure of all sources and amounts of funds contributed to the Project-, (2) A certification by Supplier's Contract Manager that the data disclosed is true and correct; (3) Proof of a Recorded Notice of Completion-, and (4) A fully executed "Final Release" in the form of Attachment 5. Should Supplier fail to make the full disclosure and certification required by subparts (1) and (2) of this paragraph (f), or should State become aware through any means that Supplier did not disclose all funding sources for the Project; the project funding may be referred to State Department of Finance for a full project audit. Commencement of repayment of the Principal Amount of the Loan and interest pursuant to Article A-13, hereof, may be required prior to the final Disbursement. (g) Force Account. Supplier may use its own employees for engineering including development of plans and specifications, legal; and administrative costs, as provided for in Supplier's initial budget summary, as required by Article A-3(f), hereof. Supplier may use its own employees for construction or construction related activities if Supplier has obtained prior State approval. If Supplier is using the services of its own employees, Supplier shall establish accounts and maintain records which reasonably document all employee hours and costs charged to the Project and the associated tasks performed by each employee. ARTICLE A-7, WITHHOLDING OF LOAN AND GRANT DISBURSEMENTS BY STATE AND CANCELLATION OF AGREEMENT (a) Conditions for ithholdrnot. If State determines that the Project is not being carried out substantially in accordance with the provisions of this Agreement or that Supplier has failed in any other respect to comply with the terms and conditions of this Agreement, State shall give written notice to Supplier of such failure to comply, If Supplier does not cure any such failure to State's satisfaction within thirty (30) calendar days of receipt of such notice, State may withhold from Supplier all or any portion of the Loan and/or Grant and take any other action that it deems necessary to protect its Page 14 of 48 SRF11CX103 interests, including but not limited to declaring Supplier in default as set forth in Article A-27, hereof, or canceling this Agreement pursuant to subpart (b) of this Article A-7. (b) Withholding Entire Funding. If State determines to withhold the entire Funding from Supplier pursuant to subpart (a) of this Article A-7, notice of such a determination shall constitute a notice of cancellation of this Agreement, and this Agreement shall no longer be binding on any party hereto. Said notice of cancellation shall be sent to Supplier by certified or registered mail, and shall be effective upon receipt. (c) Withholding Balance of Loan and/or Grant. Where a portion of the Funding has been disbursed to Supplier and State has determined to withhold the balance of the Loan and/or Grant, State shall notify Supplier in writing, via certified or registered mail, that State is withholding the balance of the Loan and/or Grant from Supplier, pursuant to subpart (a) of this Article A-7. In such event, Supplier is deemed to be in default and subject to the provisions of Article A-27, hereof. ARTICLE A-8, TIMING OF PROJECT (a) Supplier shall complete the Project not later than three (3) years from the Date of Execution. Supplier's failure to complete the Project within the specified time period may, at the option of State, be considered a material breach of this Agreement and maybe treated as a default under Article A-27, hereof. (b) Within 15 days following completion of the Project, Supplier shall certify to the local District Office of the State of California Department of Public Health that the Project is complete and ready for final inspection. Supplier's certification, as required by this subpart (b), shall be substantially in the form provided by State and attached hereto as Attachment 6 to this Agreement. (c) State will conduct a final inspection and certify that the Project is complete. Supplier shall not place the Project into operation prior to State's certification. (d) The date of State's certification or the date set forth in subpart (a) of this Article A-8, whichever shall occur first, shall be the "Project Completion Date" for purposes of this Agreement, ARTICLE A-9. SUPPLIER'S CONTRACTS Supplier shall be solely responsible for resolution of any and all disputes arising out of or related to Supplier's contracts for construction of the Project, including but not limited to bid disputes and payment disputes with Supplier's contractors and subcontractors and shall provide appropriate releases (as set forth in Title 15 of the Civil Code) as may be requested by State. Page 15 of 48 SRF11 X103 ARTICLE A-!0. AUDIT AND INSPECTION OF BOOKS AND RECORDS (a) Upon execution of this Agreement and until 3 years following final Disbursement, pursuant to Government Code Section 8546.7, the contracting parties shall be subject to the examination and audit by State or any agent thereof. Parties are also subject to examination and audit of the United States Environmental Protection Agency, the Comptroller General of the United States, and the United States Office of the Inspector General, with respect to all matters connected with the performance of this Agreement, including, but not limited to, the cost of administering this Agreement. If any litigation, claim, negotiations, audit or other action is commenced before the expiration of said time period, all records must be retained until such action is resolved, or until the end of said time period, whichever shall later occur. All records of Supplier relating in anyway to funding received pursuant to this Agreement shall be preserved for this purpose. (b) During regular office hours, each of the parties hereto and their duly authorized representatives shall have the right to inspect and to make copies of any books, records, or reports of either party pertaining to this Agreement or matters related hereto. Each of the parties hereto shall maintain and shall make available at all times for such inspection accurate records of all its costs, disbursements, and receipts with respect to its activities under this Agreement. Failure or refusal by Supplier to comply with this provision shall be considered a material breach of this Agreement, and State may declare Supplier in default as set forth in Article A-27, withhold disbursements to Supplier, or take any other action it deems necessary to protect its interests. The provisions of this subpart (b) shall be effective until expiration of the time period provided in subpart (a) of this Article A-1 0. ARTICLE A-11 STATEMENT OF PRINCIPAL AMOUNT OF LOAN (a) Transmission of Statement to Supplier, Within sixty (60) days after the final Disbursement, State shall transmit to Supplier a written statement setting forth the Principal Amount of the Loan. (b) Remittance of Funds by Sup,Llier. Within thirty (30) days from the final Disbursement, Supplier shall remit to State any funds that were disbursed under this Agreement and were not utilized to pay Eligible Project Costs or were otherwise not valid Disbursements pursuant to the terms and conditions of this Agreement. Such remittance to State shall not constitute repayment of any part of the Principal Amount of the Loan, but shall be deemed to be a return to State of part of the funds disbursed. Page 16 of 48 "1 103 ARTICLE A-12. INTEREST PAYMENTS DURING CONSTRUCTION During construction, Supplier shall pay interest to State at the rate specified in Section 9 of this Agreement on all Disbursements of the Loan. Interest on Disbursements of the Loan shall not be deferred. State will invoice Supplier semiannually for interest accrued during the Project construction period. Interest on each Disbursement of the Loan shall be calculated using the fraction x/365 times the Rate of Interest, where x is the number of calendar days remaining in the semiannual period from the date on which the Disbursement of the Loan was made. Interest accrued during the construction period is due and payable within thirty (30) days of the date of the invoice. ARTICLE A-13. REPAYMENT OF PRINCIPAL AMOUNT OF LOAN AND INTEREST (a) Terms of lie plyMent. State will invoice Supplier semiannually for principal and any interest payments. Such invoices will include a statement of the then Principal Amount of the Loan, the amount of the payment which constitutes principal to be paid, and the amount of the payment which constitutes interest, if any, to be paid. Supplier shall make semiannual payments to State no later than January I and July I of each year until the Principal Amount of the Loan is repaid in full. Principal and interest payments shall commence no later than one (1) year from the Project Completion Date. Supplier shall make level semiannual payments based on a standard semiannual payment loan amortization method to be determined by State. The standard amortization method shall incorporate the Principal Amount of the Loan as determined by Article A-11, hereof, the Loan Repayment Term specified in Section 10 of this Agreement, and the Rate of Interest, as specified in Section 9 of this Agreement. The final semiannual payment shall be in an amount equal to the then outstanding Principal Amount of the Loan, plus any remaining unpaid accrued interest. Interest on the Principal Amount of the Loan shall not be deferred, Unless earlier payment is required by the terms of this Agreement, the Principal Amount of the Loan, interest, Delinquent Interest, and any other charges or fees shall be due and payable 20 years from the Project Completion Date specified in Article A-8, hereof. (b) Advance Pgyfl1gnLQpgpR, Supplier may make advance payment against principal without penalty, provided that any such advance payment shall be applied first to interest then owed and then to principal, and provided further, that any such payment shall not relieve Supplier of its obligations to make payments in the amount and at the time specified in subpart (a) of this Article A-1 3 until the Principal Amount of the Loan is repaid in full. Any advance payment must be coordinated with State prior to the making of any such payment to ensure proper credit to Supplier's account, Page 17 of 48 R1 I18 ARTICLE A-14. PAYMENT DELINQUENCY Any payment of principal and/or interest required to be paid by Supplier to State pursuant to this Agreement which remains unpaid after it becomes due and payable shall be delinquent,. Delinquent interest charges shall be in addition to any other charges or payments owing State from Supplier and shall accrue at the rate of one tenth of one percent (g.1%) per day, on the amount of such delinquent payment, for each day it remains unpaid past the tenth (1 Oth) day after the date payment was due (the "Delinquent Interest"). The Delinquent Interest assessed will not be added to the Principal Amount of the Loan but will be treated as a separate account and obligation of Supplier. Delinquent Interest shall accrue on the total payment amount from the due date of payment through the date payment is made. Any payment by Supplier under terms of this Agreement is deemed to have been made when it is received by State. ARTICLE A-15. ACCOUNTING AND DEPOSIT OF DISBURSEMENTS (a) Se crate Accountinq of Disbursements and Interest, Records. Supplier shall account for Disbursements received separately from all other Supplier's funds, Supplier shall maintain accounting procedures that are in accordance with Generally Accepted Accounting Principles. Supplier shall keep complete and accurate records of all receipts, Disbursements, and interest earned on the Disbursements. Invoices must be maintained for a period of at least three (3) years following final Disbursement. All other records must be maintained for the Loan Repayment Term. Supplier shall require its agents, contractors and subcontractors to maintain books, records, and other documents pertinent to their work in accordance with Generally Accepted Accounting Principles. Records are subject to inspection by State at any and all reasonable times, (b) Disposition of Funds Disbursed. In addition to specific requirements set forth in this Agreement, all Disbursements shall be deposited, administered, and accounted for pursuant to all provisions of law applicable to Supplier, (c) Interim and Final Audits, In addition to the provisions of Article A-10, at any time following the Date of Execution and until completion of the Project, or final Disbursement, whichever shall occur last, State reserves the right to conduct an audit of Suppliers disposition of the Funding. After completion of the Project, State may require Supplier to conduct a final audit at Supplier's expense; such audit to be conducted by and a report prepared by an independent Certified Public Accountant. Failure or refusal by Supplier to comply with these provisions shall be considered a material breach of this Agreement and State may elect to pursue any remedies included but not limited to those provided in Article A-7, hereof. Page 18 of 48 SRF1 1 CX41 ARTICLE A-16. INSPECTIONS OF PROJECT BY STATE State shall have the right but not the duty to inspect the work being performed on the Project at any and all reasonable times during the Term of Agreement. This right shall extend to inspection of any portion of the Project under control of`Supplier's contractor and/or subcontractors, and Supplier shall include provisions ensuring such access in all its contracts or subcontracts related to the Project. ARTICLE A-17. PROHIBITION AGAINST DISPOSAL OF PROJECT WITHOUT STATE PERMISSION During the Term of Agreement- (a) Supplier shall not sell, abandon, lease, transfer, exchange, mortgage, hypothecate, or encumber in any manner whatsoever all or any portion of any real or other property necessarily connected or used in conjunction with the Project, or with Supplier's service of domestic water, without prior written consent of State. State may require as a condition of such consent, that Supplier's proceeds from any such disposition of any real or personal property be transferred to State to be applied to Suppliers indebtedness under this Agreement. (b) Supplier shall not take any action, including but not limited to actions relating to user fees, charges and assessments that Gould adversely affect the ability of Supplier to make timely payments or to otherwise meet its obligations under this Agreement. ARTICLE A-18. NONDISCRIMINATION CLAUSE During the Term of Agreement, Supplier, its contractors and subcontractors shall not deny this Agreement's benefits to any person on the basis of religion, color, ethnic group identification, sex, age, physical or mental disability, nor shall they discriminate unlawfully against any employee or applicant for employment because of race, religion, color, national origin, ancestry, physical handicap, mental disability, medical condition, marital status, age or sex. Supplier, its contractors and subcontractors shall ensure that the evaluation and treatment of employees and applicants for employment are free of such discrimination. Supplier, its contractors and subcontractors shall comply with the provisions of the Fair Employment and Housing Act (Government Code Section 12900 et seq.), the regulations promulgated thereunder (California Code of Regulations, Title 2, Section 7285.0 et seq.), the provisions of Article 9.5, Chapter 1, Part 1, Division 3, Title 2 of the Government Code (Government Code Sections 11135-11139.7) and the regulations or standards adopted by the awarding State Agency to implement such article. By signing this Agreement, Supplier assures State that it shall comply with the requirements of the Americans with Disabilities Act (ADA) of 1990, (42 U.S.C, 12101 et Page 19 of 4 SRF11 cx103 seq:), which prohibits discrimination on the basis of disability, as well as all applicable regulations and guidelines issued pursuant to the ADA; the Civil Rights Act of 1954, as amended', 42 U.S.C, 2999d (1988) et seq.; Section 504 of the Rehabilitation Act of 1973, as amended, 29 U.S.C. 794 (1989); Federal Water Pollution Control Act Amendments of 1972, Pub.L, No. 92-500, 86 Stat 818; and the Age Discrimination Act of 1975, as amended, 42 U.S.C. 6102 (1994); together with all applicable regulations and guidelines adopted to implement same (collectively, the "Anti-discrimination Laws'). Supplier agrees to collect and maintain information to show compliance with the Anti-Discrimination Laws including a list of discrimination complaints, reports of any compliance reviews conducted by other agencies descriptions of any pending discrimination-based lawsuits and data on the radial, ethnic, national origin, sex and handicap characteristics of the population it serves. Supplier agrees to cooperate with State in all manner necessary to permit State to adequately report to the United States Environmental Protection Agency on Supplier's compliance with the Anti-Discrimination Laws. Supplier, its contractors and subcontractors shall give written notice of their obligations under this Article A-1 8 to labor organizations with which they;have a collective bargaining or other agreement. Supplier's signature on this Agreement shall constitute a certification under the penalty of perjury under the laws of the State of California that Supplier has, unless exempted, complied with the nondiscrimination program requirements of Government Code Section 12990, and Title 2, California Code of regulations Section 8103. Supplier shall include the nondiscrimination and compliance provisions of this Article A-18 in all contracts and subcontracts to perform work on the Project. ARTICLE A-19. WORKERS' COMPE NSATION CLAUSE Supplier affirms that it is aware of the provisions of Section 8700 of the Labor Code, which requires every employer to be insured against liability for workers' compensation or to undertake self-insurance in accordance with the provisions of that code, and Supplier affirms that it will comply with such provisions before commencing the performance of the work under this Agreement and will make its contractors and; subcontractors aware of this provision. ARTICLE A-2 . SUCCESSORS AND ASSNS This Agreement and all of its provisions shall inure to the benefit of, apply to, and bind the heirs, successors and assigns of the parties hereto. leo assignment or transfer of this Agreement or any part hereof by Supplier shall be valid unless and until it is Page 20 of 48 RF11 C1 g approved in writing by State and made subject to such reasonable terms and conditions as State may impose. ARTICLE A-21. STATE TO BE HELD HARMLESS Supplier shall indemnify, hold harmless, protect and defend State and its officers, employees, agents and representatives from loss, suits, actions or claims brought for, or on account of violation of laws, ordinances, rules, or regulations, or injury, damage, or lass, including death, caused by acts or omissions of Supplier, its employees, contractors, or agents; or in any way arising from, or related to the Project. ARTICLE A-22. REMEDIES NOT EXCLUSIVE The use by either party of any remedy specified herein for the enforcement of this Agreement;is not exclusive, and shall not deprive the party using such remedy of or limit the application of, any other remedy provided by law, ARTICLE A-23. AMENDMENTS This Agreement may be amended only by mutual written agreement signed by the parties hereto. Requests by Supplier for amendments must be in writing stating the amendment request and the reason for the request: ARTICLE A-24. WAIVER OF RIGHTS It is the intention of the parties hereto that from time to time either party may waive any of its rights under this Agreement unless contrary to law.. Any waiver by either party hereto of rights arising in connection with this Agreement shall not be deemed to be a waiver with respect to any ether rights or matters. ARTICLE A- ,. DISPUTE CLAUSE Any dispute that Supplier may have regarding the performance of this Agreement including, but not Limited to, claims for Disbursements or extensions of time, shell be submitted to State's Contract Manager identified in Section 14 of this Agreement. State's Contract Manager may make findings and recommendations and shall transmit a copy of any such findings and recommendations to the Chief (as defined in Section 14, hereof) who shall male a decision. Such decision shall be written and transmitted to Supplier by certified or registered mail, and shall be final and conclusive. ARTICLE A_ r PERFORMANCE ANIS ASSURANCES Supplier agrees to faithfully and expeditiously perform or cause to be performed all Project work as described in the final plans and specifications as submitted and approved, or as later amended and approved by State under this Agreement and to Page 21 of 48 SRF11CX103 apply funds received only to Eligible Project Costs and to operate and maintain the Project in accordance with applicable provisions of the law. ARTICLE A-27. DEFAULT PROVISIONS (a) Supplier will be in default under this Agreement if any of the following occur (each, an "Event of Default"): (1) Supplier's failure to pay any installment when due, or the entire indebtedness to State when due at the designated due date; (2) Supplier's failure to make any remittances required by this Agreement; (3) Supplier's material breach of this Agreement, or any supplement or amendment thereto, or any other agreement between Supplier and State evidencing or securing Supplier's obligations under this Agreement; (4) Supplier's making of any false warranty, representation, or statement with respect to the Project or with respect to, or as required by, the terms of this Agreement; (5) Loss, theft, damage or impairment to any collateral given as security under this Agreement; (6) Seizure of, or levy on any collateral given as security under this Agreement; and/or (7) Dissolution or cessation of operations by Supplier, termination of Supplier's existence, insolvency of Supplier, or filing of a voluntary or involuntary bankruptcy petition by or on behalf of Supplier. (b) When an Event of Default occurs, State shall give Supplier notice of default. Supplier shall have thirty (30) calendar days from the date of such notice to cure the default. If Supplier fails to timely cure the default to the satisfaction of State, State may do any or all of the following: (1) Declare that the aggregate amount of all Disbursements made by State, including any portion of the Grant, shall be deemed the Loan, and shall be repaid to State in accordance with the terms of this Agreement; (2) Declare Supplier's obligations immediately due and payable, with or without demand or notice to Supplier, which Supplier expressly waives; (3) Terminate any obligation of State to make further Disbursements; Page 22 of 48 SRF11CX103 (4) Exercise all rights and remedies available to a secured creditor after default, including, but not limited to, the rights and remedies of secured creditors under the California Uniform Commercial Code-, (5) Perform any of Supplier's obligations under this Agreement for Supplier's account; (6) Notwithstanding the provisions of Section 5, hereof, commencing from the date of each Disbursement, apply the Rate of Interest specified in Section 9, hereof, to all Disbursements made by State, including any portion of the Grant; and/or (7) Take any other action it deems necessary to protect its interests. (c) Supplier agrees that any remedy provided in this Agreement is in addition to and not in derogation of any other legal or equitable remedy available to State as a result of a breach of this Agreement by Supplier, whether such breach occurs before or after completion of the Project. (d) No waiver by State of any breach or default will be a waiver of any other breach or default. ARTICLE A-28. DRUG-FREE WORKPLACE CERTIFICATION By signing this Agreement, Supplier hereby certifies under penalty of perjury under the laws of the State of California that Supplier will comply with the requirements of the Drug-Free Workplace Act of 1990 (Government Code Section 8350 et seq.) and will provide a drug-free workplace by taking the following actions: (a) Publish a statement notifying employees that unlawful manufacture, distribution, dispensation, possession, or use of a controlled substance is prohibited and specifying actions to be taken against employees for violations; (b) Establish a Drug-Free Awareness program to inform employees about all of the following: (1) The dangers of drug abuse in the workplace, (2) The person's or organization's policy of maintaining a drug-free workplace; (3) Any available counseling, rehabilitation and employee assistance programs-, and (4) Penalties that may be imposed upon employees for drug abuse violations. Page 23 of 48 SRF11CX103 (c) Every employee who works on the Project: (1) Will receive a copy of Supplier's drug-free policy statement, and (2) Will agree to abide by terms of Supplier's statement as a condition of employment on the Project. This Agreement may be subject to suspension of payments or termination, or both, and Supplier may be subject to debarment if State determines that (1) Supplier has made a false certification, or (2) Supplier violates the certification by failing to carry out the requirements of this Article A-28, ARTICLE A-29. CONFLICT OF INTEREST--CURRENT AND FORMER STATE EMPLOYEES Supplier shall comply with, and shall require that all of its owners, officers, directors, agents, representatives and employees are at all times in compliance with, currently applicable laws and regulations pertaining to conflicts of interest of current and former state employees, including but not limited to Government Code Sections 1090 et seq. and 87100 et seq.; Public Contract Code Section 10410 et seq.-, and California Code of Regulations, Title 2, Sections 18700 et seq. ARTICLE A-30, ADDITIONAL INSURED Supplier agrees that for any policy of general liability insurance concerning the construction of the Project, it will cause, and will require its contractors and subcontractors to cause, a certificate of insurance to be issued showing State, its officers, agents, employees, and servants as additional insured; and shall provide State with a copy of all such certificates prior to the commencement of construction of the Project. ARTICLE A-31. PROHIBITED USE OF STATE FUNDS FOR SOFTWARE Supplier certifies that it has appropriate systems and controls in place to ensure that the Funding will not be used in the performance of this Agreement for the acquisition, operation or maintenance of computer software in violation of copyright laws. ARTICLE A-32, LABOR COMPLIANCE Supplier shall comply with Public Resources Code Section 75075 and all applicable implementing guidelines and regulations adopted by California Department of Industrial Relations, regarding Labor Compliance Programs. Supplier's failure or refusal to comply with this requirement shall be considered a material breach of this Agreement. Page 24 of 48 RFIIC 103 ARTICLE A-33, DAVIS-BACON ACT COMPLIANCE Supplier understands and acknowledges that Pub.L 111-33 and Section 1450(e) of the Safe Drinking WaterAct (42 U.S.C. 300j-9(e)) make applicable provisions of sections 3141-3144, 3146, and 3147 of Title 40 of United States Code ("Davis-Bacon Act'') and applicable regulations and guidance regarding wage rates payable to laborers and mechanics employed by contractors and subcontractors on the Project. Supplier agrees to comply with all applicable Davis-Bacon Act requirements for all Project construction or construction related activities occurring on or after October 30, 2009 On or after the Date of Execution, Supplier agrees to include, or cause to be included, in full, the applicable language set forth in Attachment 7, hereof, in all Project bid solicitation documents and in all Project contracts and subcontracts in excess of ,000 entered into for the actual construction, alteration and/or repair, including. painting and decorating of any Project component. Supplier shall send a report to State at the end of each calendar quarter and on a form acceptable to the State, in which Supplier shall certify to State that all applicable Davis-Bacon Act requirements for the Project are being complied with, including, without limitation, the requirement that Supplier certify to State that Supplier is collecting and reviewing certified Davis-Bacon payrolls from Supplier's construction contractors; Supplier's failure to provide the quarterly reports required by this Article A-33 may result in State's withholding disbursements until the reports are provided in a form acceptable to the State. ARTICLE A-34 NE1Pti' RESTRICTIONS ON LOBBYING If Supplier receives $100,000 or more in federal funds disbursed under this Agreement, Supplier agrees to comply with all requirements of Title 40 CFR Part 34 "New Lobbying Requirements", as the same may amended from time to time, and to include, or cause to be included; in full, the language set forth in Exhibit ";E" hereof, in all Project contracts and subcontracts. ARTICLE A-3 : SINGLE AUDIT ACT If Supplier receives $530,000 or more in federal awards in a year from any source, including federal funds disbursed under this Agreement, Supplier agrees to comply with all requirements of the office of Management and Budget Circular A-133 issued pursuant to the Single Audit Act, as the same may be amended from time to time. Page 25 of 48 SRFIICX103 ARTICLE A-36. ADDITIONAL REPORTING Supplier acknowledges that, from time to time during the term of this Agreement, State may receive further guidance from the United States Environmental Protection Agency("UEPA°)which may require additional information/reporting from Supplier. Upon such guidance from USPA, State will notify Supplier in writing. Upon notification, Supplier agrees to provide the requested information/reports to State in the time period specified. Supplier's failure to provide the requested information/report in the time specified may be deemed by State to be a material breach of this Agreement and may be treatedas a default under Article A-27. ARTICLE A-37. DATA UNIVERSAL NUM Ef Y aTEM (DUNS) Supplier shall maintain current DUNS registration(s) in the Chun & Bradstreet database (http:f/fedoov.dnb.com/webform) at all times during which they have active federal awards funded with Safe Drinking Water State-Revolving Fund funds; Page 26 of 48 SRFIICX103 EXHIBIT B SECURITY REQUIREMENTS ARTICLE B-1 NO PRIORITY FOR ADDITIONAL LOANS Supplier agrees that it shall not incur any additional indebtedness having any priority in payment over Supplier's obligations to State under this Agreement; and that it shall not give security in any facility or equipment, which are constructed or obtained under the terms of this Agreement, without obtaining prior written consent of State, which consent shall not be unreasonably withheld. ARTICLE B-2 RATES AND CHARGES Supplier agrees that it will levy and collect assessments or user charges as may be necessary to operate and to maintain the Project and to meet the payments of the Loan when due; and if for any reason, gross revenues prove insufficient to make payments due pursuant to this Agreement, Supplier agrees to raise sufficient funds through increased user charges or assessments or any other legal means available to it to meet the Loan payments and to operate and to maintain the Project. ARTICLE B-3 SECURITY INTEREST Supplier pledges to repay the entire Principal Amount of the Loan, together with all interest thereon, as set forth in this Agreement, from net revenues from the 506403 Debt Service Fund, and Supplier hereby pledges said 506403 Debt Service Fund as collateral (the "Collateral") to secure repayment of the Loan. Supplier hereby represents and agrees that its pledge of the Collateral shall create and constitute a lien and security interest in the Collateral in accordance with the provisions of Government Code Section 5450, et seq. By its signature to this Agreement, Supplier certifies that any revenue derived from property-related fees and charges needed for the Project or the debt associated with the Project, including but not limited to the Loan obligations under this Agreement, has been approved in accordance with Article XIII C and X111 D of the California Constitution (Proposition 218), or Supplier has obtained a legal opinion explaining why such procedures are not applicable. ARTICLE B-4 RESERVE FUND Supplier agrees to provide for the accumulation of necessary reserves (the "Reserve Fund") in accordance with Section 13 of this Agreement to assure that funds will be available to make the semiannual payments when due. At a minimum, a reserve of two (2) semiannual payments shall be accumulated during the first ten (10) years of the Loan Repayment Term and thereafter be maintained at that level. The Reserve Fund shall be maintained and administered by the Fiscal Agent. Page 27 of 48 SRF11CX103 ARTICLE B-5 LEGAL OBLIGATION This Agreement and payment due hereunder, shall not in any way be construed to be a debt of the City of Redlands in contravention of any applicable constitutional or statutory limitations or requirements concerning the creation of indebtedness nor will anything contained in this Agreement constitute a pledge or obligation of general revenues, funds, or moneys for which City of Redlands is obligated to levy or pledge any form of taxation. Page 28 of 48 SRF11CX103 EXHIBIT C SPECIAL REQUIREMENTS ARTICLE C-1 SECURITY Supplier grants to State a security interest in the following: ( )> The Collateral, as more fully described in Article B-3, hereof-, and (b) The Deposit Account, as more fully described in Section 13, hereof. State reserves the right to require, and Supplier agrees to provide, security in additional real and/or personal property which State determines is reasonably necessary to secure payment of Supplier's obligations under this Agreement. Supplier shall execute any and all documents required by State to create, perfect and maintain State's security interest(s), including any amendments, modifications, and/or new or revised documents which State determines are reasonably necessary to create, perfect, maintain, preserve, and protect State's security interest(s), ARTICLE C-2 ADDITIONAL REQUIREMENTS (a) Supplier agrees to establish water rates and charges sufficient to generate and maintain net income from its 506403 Debt Service Fund equal to at least 1.2 times total debt service (the "Debt Coverage Ratio"), and agrees to maintain, at all times, the Debt Coverage Ratio until the entire Principal Amount of the Loan has been repaid in full. Supplier also agrees to demonstrate Supplier's satisfaction of the Debt Coverage Ratio to State by submitting a copy of Supplier's certified audited financial statements to State on the date which is the earlier of (i) ninety (9 0) days after June 31 of any year, or(ii) twenty (20) days following State's written request for such information. Included with the certified audit financial statements shall also be a statement from Supplier certifying to its conformance with the Debt Coverage Ratio requirement. (b) In connection with the Project, Supplier shall implement and maintain practices substantially equivalent to the urban water conservation "best management practices" of the California Urban Water Conservation Council. (c) Notwithstanding the time period to complete the Project provided in Article A-8(a) hereof, Supplier shall complete the project not later than October 31, 2013. (d) Supplier shall notify State's San Bernardino District Office when the Project is twenty-five percent (25%) complete, fifty percent (50%) complete and seventy-five (75%) complete, Page 29 of 48 SRF11CX103 (e) Supplier shall notify State's San Bernardino District Office prior to any start-up testing of the treatment facilities. (f) Commencing with continuing throughout construction of the Project, Supplier agrees to implement and maintain the mitigation measures identified in the Hinckley Water Treatment Plan Expansion Mitigated Negative Declaration (State Clearing House No. 2009091071) for the Project. Page 30 of 48 SRF11CX103 EXHIBIT D COMPLIANCE WITH DAVIS-BACON ARTICLE D-1. DAVIS-BACON PROVISIONS Supplier is required to comply with all applicable Davis-Bacon Act requirements for all Project construction or construction related activities occurring on or after October 30, 2009. The USEPA Region 9 has provided guidance on the Davis-Bacon Act requirements, which is attached hereto as "Attachment 7" and incorporated herein by reference. As used in Attachment 7, the term "subrecipient" means Supplier, and the terms "State", "State recipient" and "recipient" each mean the State of California Department of Public Health. If Supplier is a governmental entity (including, without limitation, a city, county, city and county, or local agency), the applicable contract language that is required is set forth in Section I of Attachment 7, If Supplier is not a governmental entity, the applicable contract language that is required is set forth in Section 11 of Attachment 7. Fuge 31 of 48 RF11 x103 EXHIBIT E NEW RESTRICTIONS TIONS ON LOBBYING; A. TI LE E-1, NEW RESTRICTIONS TIONS LOBBYING 40 CFR Part 34 — New Restrictions on Lobbying Subpart A---General; §34.100 Conditions on use of funds. (a) No appropriated funds maybe expended by the recipient of a Federal contract, grant, loan, or cooperative agreement to pay 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, of an employee of a Member of Congress in connection with any of the following covered Federal actions. 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 modification of any Federal contract; grant, loan, or cooperative agreement; (b) Each person who requests or receives from an agency a federal contract, grant, loan, or cooperative agreement shall file with that agency a certification, set forth in appendix A, that the person has not made, and will not make, any payment prohibited by paragraph (a) of this section, (c) Each person who requests or receives from an agency a Federal contract, grant; loan, or a cooperative agreement shall file with that agency a disclosure form, set forth in appendix B if such person has made or has agreed to make any payment using nonappropriatdd funds (to include profits from any covered Federal action), which would be prohibited under paragraph (a) of this section if pain for with appropriated funds. (d) Each person who requests or receives from an agency a commitment providing for the United Mates to insure or guarantee a loan shall file with that agency a statement, set forth in appendix A, whether that person has made or has agreed to make any payment to influence or attempt 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 that loan insurance or guarantee. (e) Each person who requests or receives from an agency o commitment providing for the United States to insure or guarantee a loan shall file with that agency a disclosure form, set forth in appendix B, if that person has made or has agreed to make any payment to influence or attempt to influence an officer or employee of any agency, Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with that loan insurance or guarantee. Page 32 of 48 SRF19 CX103 §34.105 Definitions. For purposes of this part. (d) Agency, as defined in 5 U.S.C. 552(f), includes Federal executive departments and agencies as well as independent regulatory commissions and Government corporations; as defined in 31 U.S.0 9101(1) (b) Covered Federal action means any of the following Federal actions. f) The awarding of any Federal contract, (2) The making of any Federal grant; ( ')The making of any Federal loan; 4) The entering into of any cooperative agreement; and, ( The extension, continuation; renewal, amendment or modification of any Federal contract, grant, loan, or cooperative agreement. Covered Federal action does not include receiving from an agency a commitment providing for the united States to insure or guarantee e loan; Loan guarantees and lean insurance are addressed independently within this part. c) Federal contract means an acquisition contract awarded by an agency, including those subject to the Federal Acquisition Regulation (FAR), and any other acquisition contract for real or personal property or services not subject to the FAR. d) Federal cooperative agreement means a cooperative agreement enured into by an agency.. e) Federal grant moans an award of financial assistance in the form of money, or property in lieu of money, by the Federal Government or a direct appropriation made by law to any person. The term does not include technical assistance which provides services instead of money, or other assistance in the form of revenge sharing; loans, loam guarantees, loan insurance, interest subsidies, insurance, or direct United States cash assistance to an individual. f) Federal loan means a loan made by an agency. The terra does not include loan guarantee or loam insurance: g) Indian tribe and tribal organization have the meaning provided in section 4 of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 40 ). Alaskan Natives are included under the definitions of Indian tribes in that Act. Page 33 of 4 SRF11 X103 (h) Influencing or attempting to influence mens making, with the intent to influence, any communication to or appearance before an officer or employee or any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with any coveredFederal action. (i) Loan guarantee and loan insurance means an agency's guarantee or insurance of a loan made by a person`. 0) Local government means a unit of government in a State and, if chartered, established, or otherwise recognized by a Mate for the performance of a governmental duty, including a local public authority,-a special district, an intrastate district, a council of governments, a sponsor group representative organization, and any other instrumentality of a local government: (k) Officer or employee of an agency includes the following individuals who are employed by ars agency: (1)An individual who is appointed to a position in the Government under title 5, U.S. Code, including a position under a temporary appointment; ( ) A member of the uniformed services as defined in section 101( ), title 37, U.S. Code, ( ) A special Government employee as defined in section 202, title 18, U.S. Cade; and, ( ) An individual who is a member of a Federal advisory committee, as defined by the Federal Advisory Committee Act, title 5, U.S. Code appendix 2. (1) Person meads an individual, corporation; company, association; authority, firm, partnership, society, State, and local government, regardless of whether such entity is operated for profit or not for profit. This term excludes an Indian tribe, tribal organization, or any other Indian organization with respect to expenditures specifically permitted by other Federal law. (m) reasonable compensation means, with respect to a regularly employed officer or employee of any person, compensation that is consistent with the normal compensation for such officer or employee for work that is not furnished to, not funded by, or not furnished in cooperation with the Federal Government. (n) reasonable payment means, with respect to professional and other technical services, a payment in an amount that is consistent with the amount normally paid for such services in the private sector: (o) recipient includes all contractors, subcontractors at any tier, and sugrantees at any tier of the recipient of funds received in connection with a Federal contract, grant, loan, or cooperative agreement. The term excludes an Indian tribe, tribal organization, Page 34 of 48 SPF11 CX10 or any other Indian organization with respect to expenditures specifically permitted by Bather Federal law.. (p) Regularly employed means, with respect to an officer or employee of a person requesting or receiving a Federal contract, grant, loan, or cooperative agreement or a commitment providing for the United States to insure or guarantee a loan', an officer or employee who is employed by such person for at least 130 working days within one year immediately preceding the date of the submission that initiates agency consideration of such person for receipt of such contract, grant, loan, cooperative agreement, loan insurance commitment, or loan guarantee commitment: An officer or employee who is employed by such person for less than 130 working days within one year immediately preceding the date of the submission that initiates agency consideration of such person shall be considered to be regularly employed as soon as he or she is employed by such person for 130 wording nays. (q) State means a State of the United States, the District of Columbia, the Commonwealth of Puerto Rico, a territory or possession of the United States, an agency or instrumentality of a Mate, and a multi-State,-regional, or interstate entity hawing governmental duties and powers. §34.110 Certification and disclosure. (a) Each person shall file a certification, and a disclosure form, if required, with each submission that initiates agency consideration of such person for; (1) Award of a Federal contract, grantsor cooperative agreement exceeding 100,000 or ( ) An award of a Federal loan or a commitment providing for the United States to insure or guarantee a loan exceeding $150,000. (b) Each person shall file a certification, and a disclosure form, if required, upon receipt by such person of: (1)A Federal contract, grant, or cooperative agreement exceeding; 100,000; or ( ) A Federal loan or a commitment providing for the United States to insure or guarantee a loan exceeding $150,000, Unless such person previously filed a certification, and a disclosure form; if required, under paragraph (a) of this section. (c) Each person shall file a disclosure form at the end of each calendar quarter in which there occurs any event that requires disclosure or that materially affects the accuracy of the information contained in any disclosure form previously filed by such person under Page 35 of 4 sRF1'I CX103 paragraphs (a) or(b) of this section. An event that materially affects the accuracy of the information reported includes (1`) A cumulative increase of$25,000 or more in the amount paid or expected to be paid for influencing or attempting to influence a covered Federal action; or ( )A change in the person(s) or individual(s) influencing or attempting to influence covered Federal action; or, ( A change in the officer(s), employee(s), or Member(s)) contacted to influence or attempt to influence a covered Federal action. (d)Any person who requests or receives from a person referred to in paragraphs is or (b) of this section. (1 A subcontract exceeding $100,000 at any tier under a Federal contract; ( A subgrant, contract, or subcontract exceeding $100,000 at any tier under a Federal grant, (3)A contract or subcontract exceeding $100,000 at any tier under a Federal loan exceeding $150,000; or, ( A contract or subcontract exceeding $100,000 at any tier under a Federal' cooperative agreement; Shall file a certification, and a disclosure form, if required, to the next tier above. (e) All disclosure forms, but not certifications, shell be forwarded from tier to tier until received by the person referred to in paragraphs (a) or (b) of this section. That person shall forward all disclosure forms to the agency. (f)Any certification or disclosure form filed under paragraph e) of this section shall be treated as a material representation of fact upon which all receiving tiers shall rely. All liability arising from an erroneous representation shall be borne solely by the tier filing that representation and shall not be shared by any tier to which the erroneous representation is forwarded, Submitting an erroneous certification or disclosure constitutes a failure to file the required certification or disclosure, respectively. If a person fails to file a required certification or disclosure, the United States may pursue all available remedies, including those authorized by section 1302; title 31, U.S, Code. (q) For awards and commitments in process prior to December 23, 1989, but not made before that date, certifications shall be required at award or commitment covering activities occurring between December 23, 1939; and the date of award or commitment. However, for awards and commitments in process prior to the December 23, 1989 effective date of these provisions, but not made before December 23, 1939, disclosure Fuge 36 of 4 RF11 X103 forms shall not be required at time of award or commitment but shall be filed within 30 days: (h) No reporting is required for an activity paid for with appropriated funds if that activity is allowable under either subpart B or C. Subpart B—Activities by Own Employees §34.200 Agency and legislative liaison. (a)The prohibition on the use of appropriated funds, in §34.100 (a) dues not apply in the case of a payment of reasonable compensation made to an officer or employee of a person requesting or receiving a Federal contract, grant, lean, or cooperative agreement if the payment is for agency and legislative liaison activities not directly` related to a covered Federal action. (b) For purposes of paragraph (a) of this section„ providing any information specifically requested by an agency or Congress is allowable at any time. (c) For purposes of paragraph (a) of this section, the following agency and legislative liaison activities are allowable at any time only where they are not related to a specific solicitation for any covered Federal action: (1) Discussing with an agency (including individual demonstrations) the qualities and characteristics of the person's products or services, conditions or terms of sale, and service capabilities; and, (2) Technical discussions and other activities regarding the application or adaptation of the person's products or services for an agency's use. (d) For purposes of paragraph (a) of this section` the following agencies and legislative liaison activities are allowable only where they are prior to formal solicitation of any covered Federal action: (1) Providing any information not specifically requested but necessary for an agency to make an informed decision about initiation of a covered Federal action; ( )Technical discussions regarding the preparation of an unsolicited proposal prior to its official submission; and, (3) Capability presentations by persons seeking awards from an agency pursuant to the previsions of the Small Business Act, as amended by Public Law 95-507 and ether subsequent amendments. (e) Only those activities expressly authorized by this section are allowable under this section: Page 37 of 48 SR 11 CX103 §34.205 Professional and technical services. (a) The prohibition on the use of appropriated funds, in §34.100 (a), does not apply in the case of a payment of reasonable compensation made to an officer or employee of a person requesting or receiving a Federal contract, grant, loan, or cooperative agreement or an extension, continuation, renewal, amendment, or modification of a Federal contract, grant, loan, or cooperative agreement if payment is for professional or technical services rendered directly in the preparation, submission, or negotiation of any bid, proposal, or application for that Federal contract, grant, loan, or cooperative agreement or for muting requirements imposed by or pursuant to law as a condition for receiving that Federal contract, grant, loan, or cooperative agreement.. (b) For purposes of paragraph ( ) of this section, "professional and technical services shall be limited to advice and analysis directly applying any professional or technical discipline.. For example, drafting of a legal document accompanying a bid or proposal by a lawyer is allowable. Similarly, technical advice provided by an engineer on the performance or operational capability of a piece of equipment rendered directly in the negotiation of a contract is allowable. However, communications with the intent to influence made by a professional (such as a licensed lawyer) or a technical person (such as a licensed accountant) are not allowable under this section unless they provide advice and analysis directly applying their professional or technical expertise and unless the advice or analysis is rendered directly and solely in the preparation, submission or negotiation of a covered Federal action. Thus, for example, communications with the intent to influence made by a lawyer that do not provide legal` advice or analysis directly and solely related to the legal aspects of his or her client's proposal, but generally advocate one proposal over another are not allowable under this section because the lawyer is not providing professional legal services. Similarly, communications with the intent to influence made by an engineer providing aro engineering analysis prior to the preparation or submission of a bid or proposal are not allowable under this section since the engineer is providing technical services but not. directly in the preparation, submission or negotiation of a covered Federal action. (c) Requirements imposed:by or pursuant to law as a condition for receiving a covered Federal award include those required by law or regulation, or reasonably expected to be required by law or regulation, and any other requirements in the actual award documents. (d) Only those services expressly authorized by this section are allowable under this section. §34.210 Deporting. No reporting is required with respect to payments of reasonable compensation made to regularly employed officers or employees of a person. Page 38 of 48 SRF11CX103 Subpart C—Activities by Other Than Own Employees §34.300 Professional and technical services. (a) The prohibition on the use of appropriated funds, in §34.100 (a), does not apply in the case of any reasonable payment to a person, other than an officer or employee of a person requesting or receiving a covered Federal action, if the payment is for professional or technical services rendered directly in the preparation, submission, or negotiation of any bid, proposal, or application for that Federal contract, grant, loan, or cooperative agreement or for meeting requirements imposed by or pursuant to law as a condition for receiving that Federal contract, grant, loan, or cooperative agreement. (b)The reporting requirements in §34.110 (a) and (b) regarding filing a disclosure form by each person, if required, shall not apply with respect to professional or technical services rendered directly in the preparation, submission, or negotiation of any commitment providing for the United States to insure or guarantee a loan. (c) For purposes of paragraph (a) of this section, "professional and technical services" shall be limited to advice and analysis directly applying any professional or technical discipline. For example, drafting or a legal document accompanying a bid or proposal by a lawyer is allowable. Similarly, technical advice provided by an engineer on the performance or operational capability of a piece of equipment rendered directly in the negotiation of a contract is allowable. However, communications with the intent to influence made by a professional (such as a licensed lawyer) or a technical person (such as a licensed accountant) are not allowable under this section unless they provide advice and analysis directly applying their professional or technical expertise and unless the advice or analysis is rendered directly and solely in the preparation, submission or negotiation of a covered Federal action. Thus, for example, communications with the intent to influence made by a lawyer that do not provide legal advice or analysis directly and solely related to the legal aspects of his or her client's proposal, but generally advocate one proposal over another are not allowable under this section because the lawyer is not providing professional legal services. Similarly, communications with the intent to influence made by an engineer providing an engineering analysis prior to the preparation or submission of a bid or proposal are not allowable under this section since the engineer is providing technical services but not directly in the preparation, submission or negotiation of a covered Federal action, (d) Requirements imposed by or pursuant to law as a condition for receiving a covered Federal award include those required by law or regulation, or reasonably expected to be required by law or regulation, and any other requirements in the actual award documents. (e) Persons other than officers or employees of a person requesting or receiving a covered Federal action include consultants and trade associations, Page 39 of 48 SRF11 Cif 103 f Only those services expressly authorized by this section are allowable under this section. Subpart l —Penalties and Enforcement 4,4001 Penalties, (a) Any person who makes an expenditure prohibited herein shall be subject to a civil penalty of not less than $10,000 and not more than $100,000 00 for each such expenditure: tb Any person who fails to file or amend the disclosure fora (see appendix B) to be filed or amended if required herein, shall be subject to a civil penalty of not less than $10,0010 and not more than $100,000 for each such failure. (c)A filing or amended filing on or after the date on which an administrative action for the imposition of a civil penalty is commenced does not prevent the imposition of such civil penalty for a failure occurring before that date. An administrative actions is commenced with respect to a failure when an investigating official determines in writing to commence an investigation of an allegation of such failure. d In determining whether to impose a civil penalty, and the amount of any such penalty, by reason of a violation by any persons, the agency shall consider the nature, circumstances, extent, and gravity of the violation, the effect on the ability of such person to continue in business, any prior violations by such person, the degree of culpability of such person, the ability of the person to pay the penalty, and such other matters as may be appropriate. (e) First offenders under paragraphs (a) or(b) of this section► shall be subject to a civil penalty of$10,000,, absent aggravating circumstances. Second and subsequent` offenses by parsons shall be subject to an appropriate civil penalty between $10,000 and $100,000, as determined by the agency head or his or her designee. fj An imposition of a civil penalty under this section does not prevent the United States from seeking any other remedy that may apply to the same conduct that is the basis for the imposition of such civil penalty. §34.405 Penalty procedures. Agencies shall impose and collect civil penalties pursuant to the provisions of the Program Fraud and Civil Remedies Act, 31 U.&C. 3303 (except subsection (c)), 3304, 3305, 3306, 38017, 3303, and 3812, insofar as these provisions are not inconsistent with the requirements herein, Page 40 of 48 SRFI1CX10 §34.410 Enforcement. The head of each agency shall take such actions as are necessary to ensure that the provisions herein are vigorously implemented and enforced in that agency:. Subpart E—Exemptions §34,500 Secretary of Defense; a The Secretary sof Defense may exempt, on acase-by-case basis, a covered Federal action from the prohibition whenever the Secretary determines, in writing, that such an exemption is in the national interest. The Secretary shall transmit a copy of each such written exemption to Congress immediately after making such a determination. Ib The Department of Defense may issue supplemental regulations to implement paragraph (a) of this section. Subpart F—Agency Deport §34.600Semi-annual compilation. (a) The 'head of each agency shall collect and compile the disclosure reports (see appendix B) and, on May 31 and November 30 of each year, submit to the Secretary of the Senate and the Clerk of the Nouse of Representatives a report containing a compilation of the Information contained in;the disclosure reports received during the six-month period ending on March 31 or September 30, respectively, of that year.. tb The report, including the compilation, shall be available for public inspection 30 days after receipt of the report by the Secretary and the Clerk, (c) Information that involves intelligence matters shall be reported only to the Select Committee on Intelligence of the Senate, the Permanent Select Committee on Intelligence of the House of Representatives, and the Committees on Appropriations o the Senate and the Nouse of Representatives in accordance with procedures agreed to by such committees, Such information shall not be available for public inspection, d Information that is classified under Executive Order 12356 or any successor order shell be reported only to the Committee on Foreign Relations of the Senate and the Committee on Foreign Affairs of the Nouse of Representatives or the Committees on Armed Services of the Senate and the Neuse of Representatives (whichever such committees have jurisdiction of matters involving;such information) and to the Committees on Appropriations of the Senate and the Nouse of Representatives in accordance with procedures agreed to by such committees. Such information shall not be available for public inspection: Foga 41 of 4 S F11CX103 (e) The first semi-annual compilation sell be submitted on May 31, 1990, and shall contain a;compilation of the disclosure reports received from December 23, 1989 to March 31, 1990; (f) Major agencies, designated by the Office of Management and Budget (OMB),B), are required to provide machine-readable compilations to the Secretary of the Senate and the Clerk of the Nouse of Representatives no later than with the compilations due on May 31, 1991. OMB shall provide detailed specifications in a memorandum to these agencies'. (g) Non-major agencies are requested to provide machine-readable compilations to the Secretary of the Senate and the Clerk of the Nouse of representatives. (h) Agencies shall keep the originals of all disclosure reports in the official files of the agency; §34.605 Inspector General Report. (a)The Inspector General, or other official as specified in paragraph (b) of this section, of each agency shall prepare and submit to Congress each year, commencing with submission of the President's Budget in 1991, an evaluation of the compliance of that agency with, and the effectiveness of the requirements herein. The evaluation may include any recommended changes that may be necessary to strengthen or improve the requirements. (b) In the case of an agency that does not have an Inspector General, the agency official comparable to an Inspector General shall prepare and submit the annual report, or, if there is no such comparable official, the head of the agency shall prepare and submit the annual report; (c) The annual report shall be submitted at the same time the agency submits its annual budget justifications to Congress; (d)The annual report shall include the following: All alleged violations relating to the agency's covered Federal actions during the year covered by the report, the actions taken by the head of the agency in the year covered by the report with respect to those: alleged violations and alleged violations in previous years, and the amounts of civil penalties imposed by the agency in the year covered by the report. Page 42 of 48 SRF11 Cx1 3' EXHIBIT,F COMPLIANCE WITH CROSS-CUTTING FEDERAL AUTHORITIES ARTICLE F-1. COMPLIANCE WITH FEDERAL AUTHORITIES (a) By its signature to this Agreement to which this Exhibit A11=" is attached, Supplier agrees to comply with all applicable state and federal lave and authorities, including but not limited to the federal authorities listed below; and to the fullest extent required by law, shall require compliance with said authorities by its contractors and subcontractors on the Project. • Procurement Prohibitions under Section 306 of the Clean Air Act and Section 508 of the Clean Water Act, including Executive Order 11736, Administration of the Clean Air Act and the Federal Water Pollution Control Act with Respect to Federal Contracts, Grants, or Loans • Uniform Relocation and Real Property Acquisition Policies Act, Pub. L. 91-646, as amended • Debarment and Suspension, Executive Order 12549 • Age Discrimination Act of 1975, Pub. L. 94-135 • Title V1 of the Civil Rights Act of 1964, Pub. L. 3-352 2) •' Section 13 of the Federal Water Pollution Control Act Amendments of 1972, Pub. L. 2-560 (the Clean Water Act) • Section 504 of the Rehabilitation Act of 1973, Pub. L. -112 including Executive Orders 11914 and 11255) • Equal Employment Opportunity, Executive Order 11246 • Women's and Minority Business Enterprise, Executive Orders 11625, 12136 and 1243 • Section 129 of the Small Business Administration (reauthorization and Amendment Act of 1938, Pule. L. 100-590 (b) in partial compliance with the above list of Cross-cutting Federal Authorities, Supplier agrees to tame certain actions specifically set forth in the following Articles: Page 43 of 48 SRF11CX103 ARTICLE F-2. EQUAL EMPLOYMENT OPPORTUNITY REQUIREMENTS Supplier agrees that it shall be deemed to be a contractor and shall comply with the following requirements in that role: (a) During the performance of this Agreement, the contractor agrees as follows: (1) The contractor will not discriminate against any employee or applicant for employment because of race, color, religion, sex, national origin, physical or mental handicap, or age. The contractor will take affirmative action to ensure that applicants are employed, and that employees are treated during employment, without regard to their race, color, religion, sex, national origin, physical or mental handicap, or age. 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 career development opportunities and selection for training, including apprenticeship. The contractor agrees to post in conspicuous places available to employees and applicants for employment, notices to be provided by the Federal Government setting forth the provisions of the Equal Opportunity Clause and the Rehabilitation Act of 1973. Such notices shall state the contractor's obligation under the law to take affirmative action to employ and advance in employment qualified applicants without discrimination based on their race, color, religion, sex, national origin, physical or mental handicap, or age, and the rights of applicants and employees. (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, sex, national origin, physical or mental handicap, or age. (3) The contractor will send to each labor union or representative of workers with which he has a collective bargaining agreement or other contract or understanding of notice, to be provided by the Federal Government advising the labor union or workers' representative of the contractor's commitments under the Equal Opportunities Clause, and shall post copies of the notice in conspicuous places available to employees and applicants for employment. (4) The contractor will comply with all provisions of the Rehabilitation Act of 1973 and of the Federal Executive Order No. 11246, as amended, and of the rules, regulations, and relevant orders of the Secretary of Labor. (5) The contractor will furnish all information and reports required by Federal Executive Order No. 11246, as amended, and the Rehabilitation Act of 1973, and by the rules, regulations, and orders of the Secretary of Labor, or pursuant thereto, and will permit access to his books, records, and accounts by the contracting agency Pace 44 of 4 SRF11CX103 and the Secretary of Labor for purposes of investigation to ascertain compliance with such rules, regulations, and orders, ( ) Its the event of the contractor's noncompliance with the requirements of this Equal Opportunity Clause or with the nondiscrimination clauses of this Agreement or with any of such rubs, regulations, or orders, this Agreement may be cancelled, terminated, or suspended in whole or in part and the contractor may be declared ineligible for further federal centrads in accordance with procedures authorized in Federal Executive Order No. 1`1246 as amended, and such other sanctions may be imposed and remedies invoked as provided in Federal Executive Order No 11246 as amended, or by rule, regulation, or order of the Secretary of Labor, or as otherwise provided by law. (7) The contractor will include the provisions of paragraphs (1) through (7) of this Article F-2 in every contract, subcontract or purchase order related to this Agreement unless exempted by rules, regulations, or orders of the Secretary of Labor issued pursuant to Federal Executive Order`No. 11246, as amended, or section 503 of the Rehabilitation Act of 1973, so that such provisions will be binding upon each contractor, subcontractor or vendor. The contractor will take such action with respect to any subcontract or purchase order as may be directed by the Secretary of Labor or the Director of Federal Compliance Programs or Mate may direct as a means of enforcing such provisions including sanctions for noncompliance, provided, however, that in the event the contractor becomes involved in, or is threatened with, litigation with subcontractor or vendor as a result of such direction, the contractor may request in writing to State, which, in turn, may request the United States to enter into .such litigation to protect the interests of the United States and State. Each contractor shall file, and shall cause each;of his subcontractors to filer Compliance Departs with the contracting agency or the Secretary of Labor as may be directed. Compliance Reports shall be filed within such times and shall contain such information as to the practices, policies, programs, and employment policies, programs, and employment statistics of the contractor and each subcontractor, and shall be in such form, as the Secretary of Labor may prescribe. Bidders or prospective contractors or subcontractors may be required to state whether they have participated in any previous contract subject to the provisions of Federal Executive Order 11246, as amended, or any preceding;similar Executive order, and in that event to submit, on behalf of themselves and their proposed subcontractors, Compliance Reports prior to or as an initial part of their bid or negotiation of a contract. (b) In addition, if the Project is to be constructed in a geographical area that has been designated by the Office of Federal Contract Compliance for special treatment, Supplier agrees that it will undertake, and will require its contractors and subcontractors to undertake affirmative action programs in accordance with regulations and other directives promulgated by that Office Page 45 of 4 P11C1o3 ARTICLE F-3, PARTICIPATION OF DISADVANTAGED BUSINESS ENTERPRISES ISES' (a) Supplier acknowledges that Executive Orders 11626,12138, and 12432 are applicable to this;Agreement; and that the United States Environmental Agency (EPA) adopted regulations to implement these requirements (40 Code of Federal Regulations Part 33 Participation by Disadvantaged Business Enterprises in United States Environmental Protection Agency Programs — (Federal DBE Regulations}]. In compliance with Federal DBE Regulations, Mate has negotiated "Fair Share Objectives" with EPA for participation of Minority Business Enterprises and Women's Business Enterprises in procurement activity undertaken with funds made available to Supplier under this Agreement. The "Fair Share Objectives" are set forth in the CDPH DBE Utilization Guidance attached as Attachment 8 to this Agreement and incorporated herein by this reference. Supplier agrees that it will cooperate with and assist State in realizing the "Fair Share Objectives" and will exercise goad faith efforts to achieve such participation of disadvantaged business enterprises, and in particular agrees that in the selection of construction contractors, and for the procurement of equipment, supplies, construction, and services related to the project, it, at a minimum, has or will undertake the following affirmative steps: ( ) Include disadvantage business enterprises on solicitation lists; ( ) Assure that disadvantaged business enterprises are solicited' whenever they are potential sources; (3) Divide totalrequirements, when economically feasible, into small tasks or quantities to permit maximum;participation by disadvantaged business enterprises- (4) Establish delivery schedules, when the requirements of the work permit, which will encourage participation by disadvantaged business enterprises; (5) Use the services of the Small Business Administration and the Office of Minority Business Enterprise of the U.S. Department of Commerce, and the California Unified Certification at the California Department of Transportations, as appropriate; and (6) if any contractor awards subagreements, require the contractor to take the affirmative steps in paragraphs (1) through (6) of this paragraph. (b) Supplier agrees that prior to the award of any contract for the procurement of equipment, supplies, construction, or services related to the Project, it has or will review the efforts of:such contractor to include disadvantaged business enterprises and will assure State that such contractor has complied with the requirements of this Article F-3', A firm for providing said assurance will be provided by State in a form substantially similar to that of Attachment 9 to this Agreement. Page 46 of 48 SRFI IC 10 (c) As required by Federal [QBE Regulations, Supplier agrees to circulate bid solicitation(s) for this project for a minimum of 15 days.. ( ) As requires! by Federal COBE Regulations, Supplier agrees to require prime contractor to pay subcontractors for satisfactory performance within 30 days from the prime contractor's receipt of payment from the Supplier; ( ) Supplier agrees to include in procurement solicitation provisions related to the utilization of Disadvantaged Business Enterprises in substantially the fora of Attachment 10, Supplier further agrees to include in each procurement solicitation BPA Form 6100-2, EPA Form 6100-3, and EPA Form 6100-4 as required by Federal DBE Regulations which are included in Attachment 10. (f) Supplier agrees to submit the Cored Faith Effort documentationreceived from the selected prune contractor bidder to State. (g) As required by Federal IBE regulations, Supplier agrees to create and maintain a bidders list of all firms that bid or quote on prime contracts or bid or quote subcontracts on the project. Supplier shall maintain bidders list until Supplier has certified project completion to State;_ (See Attachment 1 (lea) Supplier agrees that it shall report to State on procurements and utilization of Disadvantaged Business Enterprises semiannually, within fifteen (1 5) days after April 1 and October 1, throughout the project, until after submission of the ficial claim, Supplier shall report, using Attachment 12 to this Agreement.. ARTICLE -4. PROCUREMENT PROHIBITIONS By its signature on this Agreement, Supplier certifies that it will not procure' goods, services, or materials from any entity, or otherwise utilize any facility for the construction of the Project, if such entity or facility is listed on the ISEPA's List of Violating Facilities, and Supplier further certifies it will comply with the provisions o Executive Order No..11738, 3 C.F.R. 799 (1973), Section 306 of the Clean Air Act 42 U.&C. 7606 (1994) and Section 5013 of the Clean mater Act 33 U.S.C. 1368 (1932), ARTICLE F-5. DEBARMENT AND SUSPENSION Supplier agrees that for purposes of the following subparts a) and (b) Supplier is the "prospective lower tier participant", and this Funding Agreement is the `proposal".. (a) Instructions for Certification (1) By signing and submitting this proposal, the prospective lower tier participant is providing the certification set out below. Fuge 47 of 4 RF11 CX103 ( ) The certification in this clause is a material representation of fact upon which reliance was placed when this transaction was entered into. If it is later determined that the prospective lower tier participant knowingly rendered an erroneous certification, in addition to other remedies available to the Federal Government, the department or agency with which this transaction originated may pursue available remedies, including; suspension and/or debarment. ( ) The prospective lower tier participant shall provide immediate written notice to the person to whom this proposal is submitted if at any time the prospective lower tier participant learns that its certification was erroneous when submitted or had become erroneous by reason of charged circumstances: )< The terms covered transaction, debarred, suspended, ineligible, lower tier covered transaction; participant,person, primary covered transaction, principal, proposal, and voluntarily excluded, as used in this clause, have the meaning sot out in the Definitions and Coverage sectionsofrules implementing Executive Order 12`549. You may contact the person to which this proposal is submitted for assistance in obtaining a copy of those regulations. (lei) The prospective lower tier participant agrees by submitting this proposal that, should the proposed covered transaction be entered into, it shall not knowingly enter into any lower tier covered transaction with a person who is proposed for debarment under 48 CFR part g, subpart 9.4, debarred, suspended; declared ineligible, or voluntarily excluded from participation in this covered transaction, unless authorized by the department or agency with which this transaction originated. The prospective lower tier participant further agrees by submitting; this proposal that it will include this clause titled "Certification Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion-Lower Tier Covered Transaction" without modification, in all lower tier covered transactions and in all solicitations for lower tier covered transactions.. The prospective louver tier participant shall submit to State all certification submitted ;pursuant to this paragraph. (7) A participant in a covered transaction may rely upon a certification of_a prospective participant in a lowertier covered transaction that it is not proposed for debarment under 48 CFR part 9, subpart 9;4, debarred, suspended, ineligible, or voluntarily excluded from covered transactions, unless it knows that the certification is erroneous, A participant may decide the method and frequency by which it determines the eligibility of its principals. Each participant may, but is not required to, check the List of Parties Excluded from Federal Procurement and Non-procurement Programs. ) Nothing contained in the foregoing shall be construed to require establishment of a system of records in order to render in goad faith the certification required by this clause. The knowledge and information of a participant is not required to exceed that which is normally possessed by a prudent person in the ordinary course of business dealings. Page 48 of 48 SRF11 RC10 ( ) Except for transactions authorized under paragraph (6) of these instructions, if a participant in a covered transaction knowingly enters into a lower tier covered transaction with a person who is proposed for debarment under 48 CFR part subpart 9.4, suspended, debarred, ineligible, or voluntarily excluded from participation in this transaction, in addition to ether remedies available to the Federal Government, the department or agency with which this transaction originated may pursue available remedies, including suspension and/or debarment. (b) Certification Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion--Lower Tier Covered Transactions (1) The prospective lager tier participant certifies, by submission of this proposal, that neither it nor its principals is presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded from participation in this transaction by any Federal department or agency. 'There the prospective lower tier participant is unable to certify to any of the statements in this certification, such prospective participant shall attach an explanation to this proposal: ARTICLE F-6. UNIFORM RM RFLC C TI N AND READ PROPERTY ACQUISITION ACT Supplier will comply, or has already complied with the requirements of Titles 11 and III of the Uniform Relocation Assistance and Real property Acquisition policies Act of 1970 (public Law 91-646, 42 U.S.C. 4666)„ as amended, which provide for fair and equitable treatment of persons displaced or whose property is acquired as a result of Federal or federally assisted programs. These requirements apply to all interests in real property acquired for project purposes regardless of Federal participation in, purchase. State of Californias—Health and Hume Services Agency '40)t!rw� California Department cif Public Health til j)(_'VPH RON CHAPMAN,Mtn,MPH i EDMUND G.BROWN JR_ Director Gone or Mr. Chris Diggs, Water Resources Manager City of Redlands , 5 Cajon Street, Suite 15A Redlands, CA 933 Dear Mr. Diggs: SAFE DRINKING WATER STATE REVOLVING FUND (SDWSRF) FUNDING AGREEMENT NO. SRF11CX103— CITY OF RED NDS, PROJECT NO. 361003 '-004 Enclosed is an original executed Safe Drinking Water State Revolving Fund (SDWSRF) funding agreement, No. SRF111C103 between the City of Redlands and the California) DepartmentofPublic Health (CDPH). This funding agreement is for a $13,603„033 loan under the SDWSRF to assist your community in meeting safe drinking water standards for your domestic water supply. You may have outstanding requirements which must be met prior to disbursement of funds. Please refer to Article A-3 Basic Conditions Precedent and Article C-2 Additional Requirements of your funding agreement for details. if you have any questions, please contact the San Bernardino District Office at (900) 383-4328 or CDPH Headquarters at (916) 443-5000. The CDPH commends the City of Redlands for taking steps to correct the deficiencies that will be remedied by this project in order to provide safe drinking water to your consumers. CDPH wants to assure your successful and timely completion of this project. Therefore, if at any time you encounter unexpected difficulties in meeting requirements of your funding agreement, please contact your CDPH district office as soon as possible. Sincerely, Leah Godsey iker, P.E., Chief Division Drinki g Water and Environmental Management Division of Drinking Water and Environmental Management P.O. Box 997377, MS 7400, Sacramento, CA 95899-7377 (916)449-5600 FAX (916)449-5655 Internet Address, w vw.cdp'h=pp.q_v Mr. Chris Diggs Page 2 of 3; Enclosures cc The Honorable Robert Dutton Member of the Senate State Capitol, Room 305 Sacramento, California 94243-6991 The Honorable Mike Morrell Member of the Assembly State Capitol, Room 4102 Sacramento, California 94249-0 063 3 Ms. Feather Collins, Regional Engineer Region 1 Division of Drinking Water and Environmental Management` California Department of Public Health= 464 W. 4th Street Room 437 San Bernardino, California 92401 Mr. Dean McCarthy, district Engineer San Bernardino District Office Division of Drinking Water and Environmental Management: California Department of Public Health 464 W. 4$h Street, Room 437 San Bernardino, California 92491 Mr. Terrence Kim, Regional Coordinator Region Division of Drinking Water and Environmental Management` California Department of Public Health 695 West Santa Ana Blvd. Santa Ana, California 927011 FIs. Linda Ng, Chief Safe Drinking 'Water Office, Room 816 Department of treater Resources Post office Box 942336 Sacramento, CA 94236-9001 Mr. Jeremy Callihan, Analyst Safe Drinking Water Office, Room 316' Department of Water Resources Post Office Box 942330 Sacramento, CA 94230-0001' ^ ~ - ~ Mr. Chris Diggs CaliforniaPage 3 of 3 Ms. Lord Silva Division of Drinking Water and Environmental Management California Department of Public Health P.O. Box 997377 95899-7377 _ Ms. Stephanie Tadlock, ERU HQ Division of Drinking Water and Environmental Management California Department of Public Health RO, Box 997377 Sacramento, California 95899-7377 Mr. Joshua Ziese, Project Pipeline Coordinator Division of Drinking Water and Environmental Management California Department of Public Health P.O. Box 997377 ` ^ Sacramento,_ _ California 95899-7377 ]Ms. Uyen Division of Drinking Water and Environmental ManagementCalifornia Department of Public Health P.O. Box 997377 Sacramento, California 95899-7377 '