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Subpart 14H-70.7—Cancellation or

Reassumption of Contracts $ 14H-70.701 General.

(a) Contracts pursuant to the Act may only be cancelled or reassumed under the conditions set forth in 25 CFR 271 as follows:

(1) Retrocession (25 CFR 271.71).
(2) Reassumption (25 CFR 271.74).

(3) Cancellation for cause (25 CFR 271.76).

(b) The clauses to be included in contracts covering the above situations are found in Subpart 14H-70.6 of this part.

Indian tribe; Provided, That such tribe or tribal organization shall require any subcontractor performing work under the contract to provide a performance bond in the amount and manner set forth in f 1-10.104-1 of this title.

(b) The clause to be included in construction contracts with Indian tribes and Indian organizations relative to performance bonds is set forth in $ 14H-70.621.

8 14H-70.702 Settlement of cancelled con

tracts. The settlement of any contracts cancelled or reassumed for the reasons set forth in § 14H-70.701 shall be as mutually agreed to by the Bureau and the contractor. If mutual agreement cannot be reached, the principles set forth in Subpart 1-8.6 of this title shall be used to arrive at the settlement.

8 14H-70.804 Payment bonds.

(a) Payment bonds will not be required from an Indian tribe or Indian organization serving as a governmental instrumentality of an Indian tribe: However, such tribe or tribal organization shall require any subcontractor performing work under the contract to provide a payment bond in the amount and manner set forth in § 110.105-1 of this title.

(b) The clause to be included in construction contracts with Indian tribes and Indian organizations relative to payment bonds is set forth in § 14H70.621.

Subpart 14H-70.8—Bonds and


8 14H-70.801 Scope of subpart.

This subpart deals with the requirement for tribal organizations to furnish bid guarantees, performance bonds and payment bonds on contracts for construction.

8 14H-70.802 Policy on use of bid guaran

tees. Bid guarantee will not be required in connection with construction contracts negotiated with an Indian tribe or an Indian organization serving as a governmental instrumentality of an Indian tribe; Provided, That such tribe or tribal organization shall require any potential subcontractor to furnish a bid guarantee in the amount and manner set forth in § 1-10.104-1 of this title. 8 14H-70.803 Performance bonds.

(a) Performance bonds will not be required from an Indian tribe or Indian organization serving as a governmental instrumentality or an

8 14H-70.805 Liability insurance.

(a) This section prescribes policies and procedures with respect to the furnishing of liability insurance by Indian contractors in accordance with 25 CFR 271.45.

(b) Contracting offices shall assure themselves that all contracts with tribal organizations provide for the tribal organization to obtain general liability insurance and motor vehicle insurance. Each such contract shall further provide that the insurance carrier must be satisfactory to the contracting officer and that the contractor shall forward to the contracting officer a copy of the certificate of insurance as soon as such certificate is received from the insurance carrier.

8 14H-70.806 Insurance coverage.

(a) The insurance provided by the contractor shall provide coverage to the contractor, the United States, their agents, and their employees within minimum amounts that are at least comparable to the minimum insurance coverage carried by other ortracting officer when he determines such action is warranted. [40 FR 51332, Nov. 14, 1975, as amended at 43 FR 37450, Aug. 23, 1978)

ganizations in the same general area performing similar activities.

(b) The insurance shall provide for a waiver by the insurance carrier of any right it may have to raise as a defense the tribe's sovereign immunity from suit when a claim is within the limits of the policy. Further, the insurance shall not empower the insurance carri. er to waive or otherwise limit the tribe's sovereign immunity outside or beyond the coverage and limits of the policy of insurance.

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8 14H-70.807 Exceptions.

(a) In those cases where the contracting officer determines that the risk of death, personal injury or property damage under the contract is small and that the time and cost of procuring the insurance is great in relation to the risk, he may exempt such contracts from the requirements of this subpart.

(b) Some of the factors which the contracting officer shall consider in determining the magnitude of the risk involved are:

(1) The nature of the program contracted for.

(2) The number of persons involved in performing the contract.

(3) The contract period.

(4) The number of persons likely to come in contact with or be affected by the performance of the contract.

(5) The nature and value of any property which might be affected by the contract.

8 14H-70.901 Labor standards in construc

tion contracts. The provisions of Subpart 1-12.4 of this title are applicable to construction contracts entered into pursuant to the Act, except when the contractor is the recognized governing body of an Indian tribe or a non-profit Indian organization serving as a governmental instrumentality of an Indian tribe. 8 14H-70.902 Labor standards in subcon

tracts. Subcontracts shall include and subcontractors shall comply with the provisions of Part 1-12 of the Federal Procurement Regulations (41 CFR Part 1-12) to the extent that the provisions are applicable to the subcontract requirements. Questions concerning the applicability of the provisions of Part 1-12 of the Federal Procurement Regulations should be addressed to the contracting officer.

Subpart 14H-70.10—Contract Cost

Principles and Procedures

8 14H-70.1001 Principles for determining

costs. The principles for determining costs applicable to contracts under the Act are contained in Appendix A to 25 CFR Part 276.

§ 14H-70.808 Motor vehicle insurance.

Notwithstanding the provisions of $ 14H-70.807, any contract which requires or authorizes, either expressly or by implication, the use of motor vehicles must contain a provision requiring the tribal contractors to provide motor vehicle insurance, regardless of how small the risk may seem.

8 14H-70.809 Insurance clause.

The clause contained in g 14H-70.611 shall be included in all contracts with tribal contractors, unless the contracting officer determines that an exemption is warranted under g 14H-70.807. The limits of liability prescribed in the clause may be modified by the con

8 14H-70.1002 Predetermined fixed rates.

(a) Indirect cost or overhead rates may be negotiated annually where cost experience, reliable accounting data and other pertinent facts are available to support the projection of allowable costs for the period covered by the contract or grant. Negotiated rates shall not result in an amount which will exceed actual costs.

(b) Where cost experience and ac. counting data are not available to support a negotiated rate and where the estimated amount of the contract is less than $10,000, a lump sum over

head amount may be negotiated. Such (3) Current overhead rates have an amount will be based on reasonable been established by another Federal projection of estimated costs to be in agency. curred by the tribal organization and shall take into consideration all costs Subpart 14H-70.11-Procurement which can be applied as direct costs,

Forms and shall not exceed 10 percent of the direct labor costs.

8 14H-70.1101 Applicability of standard 8 14H-70.1003 Procedures.

forms. (a) When a tribal organization de

The standard forms prescribed in

Part 1-16 of this title may be used in sires overhead rates to be established

connection with contracts entered into and where no other Federal agency

pursuant to the Act when applicable has established a rate nor will be ex

and may be modified when deemed pected to do so, the tribal organization

necessary. However, standard forms may request through the contracting

other than SF 147 that contain clauses officer that a rate be established. The

not prescribed by this Part 14H-70 request shall be supported by, as a

shall not be used. minimum:

(1) A schedule of common costs which cannot be feasibly charged as

Subpart 14H-70.12–Procurement of direct costs of a program and are costs

Construction benefiting more than one program.

(2) The nature and extent of services & 14H-70.1201 Scope of subpart. provided and their relevance to the This subpart sets forth procedures specific program.

and requirements peculiar to construc(3) Methods and manner of distribu- tion contracts. The terms and condition of costs.

tions of construction contracts when (4) Total business of all programs to negotiated with an Indian organizawhich indirect costs will be distribut- tion pursuant to the Act shall to the ed.

extent applicable be in accordance (b) The contracting officer shall, with the requirements set forth in after review and if indicated, further Part 1-18 of this title. However consultations with the tribal organiza there is a conflict between Part 1-18 of tion, forward the request to the De this title and any provision of the Act partment of Interior, Office of Audit or 25 CFR Part 271, the Act or 25 CFR and Investigation, for review and audit Part 271 shall govern. as determined necessary. In the event a rate is approved without audit, the $ 14H-70.1202 Exceptions. contract shall contain a clause to the (a) Subpart 1-18.10 of this title is effect that upon audit the rate may be not applicable. changed retroactively to the beginning (b) The contract clauses required by of the contract period.

$ 1-18.703-1 of this title shall be in(c) An audit by the Department's serted in construction contracts with Office of Audit and Investigation will an Indian tribe or an Indian organizanot be required prior to contract tion which serves as a governmental award and overhead rates may be ap instrumentality of an Indian tribe, but proved by the Contracting Officer shall be prefaced by the provision conwhen:

tained in § 1-18.703-2 of this title. (1) The amount of the contract is (c) In all cases, the contracting offiless than $100,000.

cer shall obtain and insert the Wage (2) The contract is not the initial Determination Decision issued by the contract with the particular tribal or- Secretary of Labor in the contract ganization, an overhead rate was pre- prior to award of any contract for conviously established, and the overhead struction that falls within the purview rate currently requested does not of the Davis-Bacon Act. The Wage Deexceed that previously established one termination Decision should be furby more than one percentage point. nished sufficiently in advance of the

contract award date to permit full con- mined suitable to satisfy the minimum sideration by the tribal organization essential needs of the contractor. and any prospective subcontractors (d) Subsequent advances may be prior to contract award.

made at times and in amounts deter

mined necessary to insure availability Subpart 14H-70.13—Retention Re of funds for timely payment of the

quirements for Contractor and Sub contractor's obligations and to minicontractor Records

mize the time between withdrawal

from the Treasury and expenditure. $ 14H-70.1301 General.

For advance payment methods other The record retention requirements

than the Letter of Credit method, rein Subpart 1-20.2 and Subpart 1-20.3 quests for advances made after an ini. of this title are applicable to contracts tial advance shall be accompanied and under the Act.

supported by a report of expenditures

to date, the amount of funds on hand, Subpart 14H-70.14-Contract

and the anticipated needs until receipt Financing

of payment.

[40 FR 51332, Nov. 14, 1975, as amended at 8 14H-70.1401 General.

43 FR 37450, Aug. 23, 1978) This subpart sets forth the methods

8 14H-70.1404 Advance payments when of making payments to tribal organizations performing contracts under the

special bank account required. Act.

(a) Contracts authorizing the

making of advance payments shall, 8 14H-70.1402 Reimbursement.

except as provided in 25 CFR This method will be used when a 271.41(a)(2)(i), require that the check tribal organization does not request an be mailed to a bank to be deposited in advance payment. Payment will be a special bank account in the name of made on receipt of a SF-1034 or other the contractor. No part of the funds approved invoice form supported by deposited in the special bank account documentation required by the con- shall be mingled with other funds of tract after completion of the contract

the contractor prior to withdrawal to or such portions thereof as provided in

meet obligations accruing under the the contract for partial payments.

contract. 8 14H-70.1403 Advance payments

(b) For all advance payments requir

by Treasury check.

ing the use of a special bank account,

the form of Agreement for Special (a) At the request of a tribal contrac

Bank Account prescribed in $ 14Htor, and subject to the conditions here

70.1410 shall be used. inafter set forth, and Chapter 2000 of

(c) All contracts requiring the use of the Treasury Fiscal Requirements Manual as modified or supplemented,

a special bank account shall contain the Government will make advance

the contract clause prescribed in payments to tribal organizations as

$ 14H-70.612(b). prescribed in 25 CFR 271.41.

8 14H-70.1405 Letter of credit. (b) Any request for advance pay. ment by a tribal contractor shall speci. When a contract authorizes advance fy the amount(s) required and the payments totaling $120,000 or more dates such advance(s) will be required and the contract period is one year or and shall be supported by a schedule more, advance payments will normally of estimated expenditures.

be made by Letter of Credit in accord(c) An initial advance will be limited ance with the policies and procedures to the amount of estimated expendi contained in Treasury Fiscal Requiretures for a period of time required to ments Manual, Chapter 2000, as modi. effect payment, based on experience in fied or supplemented. the locality. The initial advance may be made in amounts at times deter

request by the contractor. In such cases, reports of expenditures will be required and payments will be adjusted as necessary to prevent withdrawal of funds over and above that needed for efficient operation, and to insure adequate funds for timely settlement of the contractor's obligations. Adjustments to automatic advances shall be made after consultation with the contractor.

§ 14H-70.1406 Approval of advance pay.

ments. (a) Area Directors may approve advance payments which do not exceed $250,000 in the aggregate. When the contract term is for more than one year, Area Directors may approve advance payments which do not exceed $250,000 in the aggregate for each succeeding year of the contract.

(b) Requests for advance payments exceeding $250,000 in the aggregate for the term of the contract, or one year if a multi-year contract, shall be forwarded to the Commissioner of Indian Affairs by Area Director for submission to the Department in accordance with § 14-30.406 of this title. However, this limitation does not apply when the advance payment(s) is made through a Letter-of-Credit. [40 FR 51332, Nov. 14, 1975, as amended at 43 FR 37450, Aug. 23, 1978)

8 14H-70.1407 Sub-advances.

Sub-advances may be made when predetermined as a part of a contracted program or when specifically authorized in writing by the contracting officer. Subadvances will not be made to individuals except for approved travel and in such cases shall not exceed the minimum required for one trip and shall be settled by voucher or repayment within 30 days.

8 14H-70.1410 Agreement for special bank

account. (a) In all instances where deposit of an advance payment in a special bank account is required, the following form of agreement will be used:

AGREEMENT FOR SPECIAL BANK ACCOUNT (1) This agreement entered into between the United States of America, hereinafter called the “Government,” contractor, and Bank, each represented by the officials executing this agreement.

(2) The Government and the contractor entered into the contract(s) or Supplemental Agreement(s) thereto, providing for the making of advance payment(s) to the contractor. Copy of the advance payment clause included in the contract is attached to and made a part of this agreement.

(i) The advance payment clause requires that amounts advanced to the contractor be deposited in a Special Bank Account at a member bank or banks of the Federal Reserve System or any "insured” bank within the meaning of the Act creating the Federal Deposit Insurance Corporation (Act of August 23, 1935; 49 Stat. 684, as amended; 12 U.S.C. 264), separate from the contractor's general or other funds; and, the Bank being such a bank, the parties are agreeable to so depositing said amounts with the Bank.

(ii) This Special Bank Account shall be designated as indicated in paragraph (7) of this agreement.

(3) In consideration of the foregoing, and for other good and valuable considerations, it is agreed that:

(i) The Government shall have a lien upon the credit balance in said account to secure the repayment of all advance payments made to the contractor, which lien shall be superior to any lien or claim of the bank with respect to such account.

(ii) The Bank will be bound by the provisions of the advance payment clause relating to the deposit in and withdrawl of funds from the Special Bank Account, but shall not be responsible for the use of funds withdrawn from said account. Upon receipt by the Bank of written directions of any kind

8 14H-70.1408 Interest.

(a) Contractors shall not be held accountable for interest earned on funds advanced pending disbursement. However, it is required that bank balances be maintained at the minimum level consistent with program requirements, and requests for advances shall be reviewed to insure that excess funds are not advanced.

(b) Contractors shall not be charged interest by the Bureau for funds advanced under contracts entered into pursuant to the Act.

8 14H-70.1409 Automatic advances.

When periodic payments under a contract will be essentially uniform and predictable, automatic advance payments may be authorized by the contracting officer to avoid delay in herent in payments based on formal

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