HomeMy WebLinkAboutAll Star Environmental, LLC - Contract No. AB-2024-06-01P - 7/1/2024 ASBESTOS ABATEMENT SERVICES CONTRACT#AB-2024-06-01P
123 East Parker Street (former Saint Mary's Villa) (rebid)
This Contract for Asbestos Abatement Services (the "Contract") is entered into as of July
1, 2024, by and between the City of Waterloo, Iowa("City") and All Star Environmental, LLC.
In consideration of the mutual promises exchanged herein, the parties agree as follows:
1. Term and Services. For the period of July 1, 2024 thru September 30, 2024,
subject to extension upon the mutual written agreement of the parties, the Contractor agrees to
furnish all tools, labor and materials, and perform and substantially complete all work within the
time period stated in the specifications after receipt of Notice to Proceed with respect to a given
property or set of properties. By executing this Contract, Contractor certifies that it holds an
asbestos permit issued by the Iowa Division of Labor and that all personnel who perform work
on the project will have an asbestos license issued by the Iowa Division of Labor. Contractor
agrees that such permit and licenses will be maintained during the term of this Contract. Work to
be performed includes all work described in the Contract Documents (defined below).
Contractor shall provide the above services at the cost set forth in the Contractor's RFB
response. Contractor's request for payment for services authorized under this Contract shall be
submitted in accordance with the Contract Documents and will be paid within forty-five (45)
days after receipt of an original invoice and after such services are delivered and accepted and all
necessary supporting documentation is submitted. Contractor will be paid for all items
satisfactorily completed. Such payment will be full compensation for asbestos removal and
disposal, for all permits, licenses, inspections, for complying with all laws,rules, regulations and
ordinances, including safety, and for furnishing all materials, equipment and labor to complete
the work in accordance with the plans and specifications.
2. Contract Documents. The following documents (collectively, the "Contract
Documents") are hereby incorporated by reference as though set forth herein in full:
a. Request for Bid
b. Addenda(if any)
c. Response (Proposal) from the Contractor
In the event of conflict between the provisions of the Contract Documents and this Contract,the
provisions of this Contract shall prevail.
2.1 Contract Limits. Total actual expenses allowed by the project Contract, including
any renewal extensions of the Contract, shall not exceed $135,679.00 as provided in the Bid
Tabulation that is part of Contractor's RFB Response referenced in Section 2.c above, except by
written amendment as provided herein.
3. Approval; Timing of Work. Contractor shall not begin work until after the
Contract has been approved by the City Council and the Contractor has been issued a Notice to
Proceed. The work shall commence within ten(10) days after the City has issued a Notice to
Proceed with respect to any particular property or set of properties, and all work shall be
completed and delivered within the term of the Contract.
4. Performance Bond. Not required for this Contract.
4.1 Payment Bond. Not required for this Contract.
5. Reporting; Records. Contractor shall exercise best efforts to maintain
communication with City personnel whose involvement in the project is necessary or advisable
for successful and timely completion of the work of the project. Communications between the
parties shall be verbal or in writing, as requested by the parties or as dictated by the subject
matter to be addressed. Contractor shall maintain all project records for a minimum period of
three (3)years after the date of final payment for services rendered under this Contract. During
the term of this Contract and for the ensuing record-retention period, Contractor shall make any
or all project records available upon reasonable request, and in any event within two (2) business
days of request, to City, and any other agency of state or federal government. For purposes of
this section, "records"means any and all books, documents, papers and records of any type or
nature that are directly pertinent to this Contract. Contractor agrees to furnish, upon termination
of this Contract and upon demand by the City, copies of all basic notes and sketches, charts,
computations, and any other data prepared or obtained by the Contractor pursuant to this
Contract, without cost and without restrictions or limitation as to the use relative to specific
projects covered under this Contract. In such event, the Contractor shall not be liable for the
City's use of such documents on other projects.
6. Reserved.
7. Indemnity. Except as to any negligence of City, its officials, officers, employees
or agents, in the performance of any duty under this Contract, and to the extent not covered by
insurance maintained by Contractor, Contractor agrees to defend and indemnify City, its
officials, officers, employees and agents, and to hold same harmless, from and against any and
all claims, demands, causes of action, losses, costs, or liabilities whatsoever, including but not
limited to reasonable attorneys' fees and expenses, arising from or in connection with the acts or
omissions of Contractor in providing the services contemplated by this Contract. This will
include but is not limited to actions or suits based upon or alleging bodily injury, including death,
or property damage rising out of or resulting from the Contractor's operation under this Contract,
whether by itself or by any subcontractor or anyone directly or indirectly employed by any of
them. Contractor is not and shall not be deemed an agent or employee of the City.
8. Default; Termination for Cause. In the event that Contractor defaults in the
performance or observance of any covenant,agreement or obligation set forth in this Contract, and
if such default remains uncured for a period of seven(7) days after notice thereof shall have been
given by City to Contractor(or for a period of fourteen(14)days after such notice if such default is
curable but requires acts to be done or conditions to be remedied which, by their nature, cannot be
done or remedied within such 14-day period and thereafter Contractor fails to diligently and
continuously prosecute the same to completion within such 14-day period),then City may declare
that Contractor is in default hereunder and may take any one or more of the following steps, at its
option:
2
a. by mandamus or other suit, action or proceeding at law or in equity,require
Contractor to perform its obligations and covenants hereunder, or enjoin any
acts or things which may be unlawful or in violation of the rights of the City
hereunder, or obtain damages caused to the City by any such default;
b. have access to and inspect, examine and make copies of all books and records
of Contractor which pertain to the project;
c. declare a default of this Contract,make no further disbursements, and demand
immediate repayment from Contractor of any funds previously disbursed under
this Contract;
d. terminate this Contract by delivery to Contractor of written notice of
termination; and/or
e. take whatever other action at law or in equity may be necessary or desirable to
enforce the obligations and covenants of Contractor hereunder,including but
not limited to the recovery of funds.
No delay in enforcing the provisions hereof as to any breach or violation shall impair, damage or
waive the right of City to enforce the same or to obtain relief against or recover for the continuation
or repetition of such breach or violation or any similar breach or violation thereof at any later time
or times. In the event that City prevails against Contractor in a suit or other enforcement action
hereunder, Contractor agrees to pay the reasonable attorneys' fees and expenses incurred by City.
9. Termination for Convenience. This Contract may be terminated at any time, in
whole or in part, upon the mutual written agreement of the parties. City may also choose to
terminate this Contract at any time by delivering to Contractor 10-days' advance written notice
of intent to terminate.
10. Non-Assignable Duties. Contractor may not assign its duties hereunder without
the prior written consent of City.
11. Independent Contractor. Contractor is an independent contractor and is not an
employee, servant, agent, partner, or joint venturer of City. Contractor has no power or authority
to enter into contracts or agreements on behalf of City. City shall determine the work to be done
by Contractor, but Contractor shall determine the legal means by which it performs the work
specified by City. City is not responsible for withholding, and shall not withhold, FICA or taxes
of any kind from any payments which it owes Contractor. Neither Contractor nor its employees,
if any, shall be entitled to receive any benefits which employees of City are entitled to receive
and shall not be entitled to workers' compensation, unemployment compensation, medical
insurance, life insurance, pension, or any benefits of any type or nature whatsoever on account of
their work for City. Contractor shall be solely responsible for compensating its employees, if
any.
12. Anti-Discrimination. During the performance of this Contract, Contractor, for
itself, its assignees and successors in interest, agrees to comply with the anti-discrimination laws
3
of the State of Iowa, as contained in Sections 19B, 551.4 of the Code of Iowa, which are herein
incorporated by reference and made a part of this Contract.
13. Severability. In the event any provision of this Contract,together with the
Contract Documents, is held invalid, illegal, or unenforceable, whether in whole or in part, the
remaining provisions of this Contract shall not be affected thereby and shall continue in full
force and effect. If, for any reason, a court finds that any provision of this Contract is invalid,
illegal, or unenforceable as written, but that by limiting such provision it would become valid,
legal, and enforceable, then such provision shall be deemed to be written and shall be construed
and enforced as so limited.
14. General Terms. This Contract, together with the Contract Documents, constitutes
the entire agreement between the parties pertaining to the subject matter hereof This Contract
may not be modified or amended except pursuant to the mutual written agreement of the parties.
This Contract is binding on the parties and the heirs,personal representatives, successor and
assigns of each. Time is of the essence in the performance of the terms hereof.
This Contract is also subject to the following additional Contract requirements:
Certifications:
By execution of this Agreement, the Contractor certifies that all contractors, subcontractors,
and/or eligible suppliers to be used on the Project are eligible to participate in the federal
Community Development Block Grant Program, and that they are not on any debarred,
suspended, or ineligible list.
Domestic Preference for Procurement
As appropriate and to the extent consistent with law,the non-federal entity should, to the greatest
extent practicable under a Federal award, provide a preference for the purchase, acquisition, or
use of goods,products, or materials produced in the United States. The requirements of this
section must be included in all sub awards including all contracts and purchase orders for work
or products under this award.
PERSONNEL AND PARTICIPANT CONDITIONS
Civil Rights Compliance
The Contractor agrees to comply with Chapter 216 (State Civil Rights) of the Iowa Code and
with Title VI of the Civil Rights Act of 1962 as amended Title VIII of the Civil Rights act of
1968 as amended, Section 104 (b) and Section 109 of Title I of the Housing and Community
Development Act of 1974 as amended, Section 504 of the Rehabilitation Act of 1973, the
Americans with Disabilities Act of 1990, the Age Discrimination Act of 1975, Executive Order
11063, and Executive Order 11246 as amended by Executive Order 11375, 11478,12107,and
12086.
4
Nondiscrimination
The Contractor agrees to comply with the non- discrimination in employment and contracting
opportunities laws, regulations and executive orders reference in 24 CFR 570.607, as revised by
Executive Order 13279. The applicable non- discrimination provisions in Section 109 of the
HCDA are still applicable.
Section 504
The Contractor agrees to comply with all Federal regulations pursuant to compliance with
Section 504 of the Rehabilitation Act of 1973. (29 U.S.C. 794) which prohibits discrimination
against individuals with disabilities or handicaps in a federally assisted program. The Contractor
confirms that no otherwise qualified individual with handicaps shall, solely by reason of his/her
handicap, be excused from participation in, be denied benefits of or be subjected to
discrimination. This does include, but is not limited to, housing, employment and the delivery of
services and programs.
Affirmative Action
Affirmative Action Plan
The Contractor agrees that it shall be committed to carry out affirmative action marketing in
keeping with the principles as provided in Presidents Executive Order 11246 of September 24,
1966.
No person shall be excluded from or denied benefits of the Contractors service on the basis of
age, race, color, religion, creed,national origin, sex, marital status, disability or sexual
orientation. All current and prospective project beneficiaries must, however be in need of the
programs provided by the Contractor.
The Contractor shall comply with requirements set forth in 24 CFR 570.601.
Women and Minority Owned Business Based(WBE/MBE)
The Contractor will use its best efforts to afford small businesses, minority business enterprises
and women's business enterprises the maximum practicable opportunity to participate in the
performance of the Agreement. As used in this contract , the terms small business means a
business that meets the criteria set forth in section 3(a) of the Small Business Act', as amended (
15 U.S.C. 632) and minority and women's business enterprise means a business at least 51%
owned and controlled by a minority group or women.
Equal Opportunity and Affirmative Action Statement
The Contractor will, in all solicitations or advertisements for employees placed by or on behalf
of the Contractor, state that it is an Equal Opportunity or Affirmative Action employer.
5
Subcontract Provisions
The Contractor will include the provisions of Civil Rights and Affirmative Action in every sub
contract, so that such provisions will be binding upon each of its own sub-contractors.
Employment Restrictions
Prohibited Activity
The Contractor is prohibited from using funds proved herein or personnel employed in the
administration of the program for political activities; inherently religious activities; lobbying;
political patronage or nepotism activities.
Labor Standards
The Contractor agrees to comply with the requirements of the Secretary of Labor in accordance
with the Davis-Bacon Act as amended, the provisions of Contract Work Hours and Safety
Standards Act (40 U.S.C. 327 et seq.)and all other applicable Federal, state, and local laws and
regulations pertaining to labor standards insofar as those acts apply to the performance of this
Agreement.
The Contractor agrees to comply with the Copeland Anti-Kick Back Act (18 U.S.C. 874 et seq.)
and it's implementing regulations of the U.S. Department of Labor at 29 CFR 5.
The Contractor shall maintain documentation that demonstrates compliance with hour and wage
requirements of this part. Such documentation shall be made available to the City for review
upon request. The Contractor agrees that, except with respect to the rehabilitation or
construction of residential property containing less than eight (8)units, all contractors engaged
under contracts in excess of$2,000.00 for construction, renovation, or repair work financed in
whole or in part with assistance provided under this contract, shall comply with Federal
requirements adopted by the City pertaining to such contracts and with the applicable
requirements of the regulations of the Department of Labor, under 29 CFR 1, 3, 5 and 7
governing the payment of wages and ratio of apprentices and trainees to journey workers;
provided that, if wage rates higher than those required under the regulations are imposed by state
or local law, nothing hereunder is intended to relieve the Contractor of its obligation, if any, to
require payment of the higher wage. The Contractor shall cause or require to be inserted in full,
in all such contracts subject to such regulations, provisions meeting the requirements of this
paragraph.
Section 3 Clause Compliance
Compliance with the provisions of Section 3 of the HUD Act of 1968, as amended, and as
implemented by the regulations set forth in 24 CFR 135, and all applicable rules and orders
issued hereunder prior to the execution of this contract shall be a condition of the Federal
financial assistance provided under this contract and binding upon the City, the Contractor and
any of the Contractors subcontractors. Failure to fulfill these requirements shall subject the City,
the Contractor, and any of the Contractor's subcontractors, their successors and assigns, to those
sanctions specified by the Agreement through which Federal assistance is provided. The
6
Contractor certifies and agrees that no contractual or other disability exists that would prevent
compliance with these requirements.
The Contractor further agrees to comply with these Section 3 requirements and to include the
following language in all subcontracts executed under this Agreement:
The work to be performed under this Agreement is a project assisted under a program providing
direct Federal financial assistance from HUD and is subject to the requirements of Section 3 of
the Housing and Urban Development Act of 1968, as amended (12 U.S.C. 1701). Section 3
requires that to the greatest extent feasible opportunities for training and employment be given to
low and very low-income residents of the project area, and that contracts for work in connection
with the project be awarded to business concerns that provide economic opportunities for low-
and very low-income persons residing in the metropolitan area in which the project is located.
The Contractor further agrees to ensure that opportunities for training and employment arising in
connection with a housing rehabilitation(including reduction and abatement of lead-based paint
hazards), housing construction, or other public construction project are given to low- and very
low-income persons residing within the metropolitan area in which the CDBG-funded project is
located; where feasible,priority should be given to low- and very low-income persons within the
service area of the project or the neighborhood in which the project is located, and to low- and
very low-income participants in other HUD programs; and award contracts for work undertaken
in connection with a housing rehabilitation (including reduction and abatement of lead-based
paint hazards), housing construction, or other public construction project to business concerns
that provide economic opportunities for low- and very low-income persons residing within the
metropolitan area in which the CDBG-funded project is located; where feasible,priority should
be given to business concerns that provide economic opportunities to low- and very low-income
residents within the service area or the neighborhood in which the project is located, and to low-
and very low-income participants in other HUD programs.
The Contractor certifies and agrees that no contractual or other legal incapacity exists that would
prevent compliance with these requirements.
See Attachment 1 for full Section 3 Contract Requirements.
Subcontracts
The Contractor will include this Section 3 clause in every subcontract and will take appropriate
action pursuant to the subcontract upon a fording that the subcontractor is in violation of
regulations issued by the City. The Contractor will not subcontract with any entity where it has
notice or knowledge that the latter has been found in violation of regulations under 24 CFR 135
and will not let any subcontract unless the entity has first provided it with a preliminary
statement of ability to comply with the requirements of these regulations.
Conduct
Assignability
7
The Contractor shall not assign or transfer any interest in this Agreement without the prior
written approval of the City. Any assignment made without consent shall be void. This
Agreement shall be binding upon and shall inure to the benefit of the successors and assigns of
the parties hereto.
Hatch Act
The Contractor agrees that no funds provided, nor personnel employed under this Agreement,
shall in any way or to any extent engaged in the conduct of political activities in violation of
Chapter 15 of Title V of the U.S.C.
Conflict of Interest
The Contractor agrees to abide by the provisions of 2 CFR 200 and 570.611, which include (but
are not limited to) the following:
The Contractor shall maintain a written code or standards of conduct that shall govern the
performance of its officers, employees, or agents engaged in the award and administration of
contracts supported by Federal funds.
No employee, officer, or agent of the Contractor shall participate in the selection, or in the
award, or administration of, a contract supported by Federal funds if a conflict of interest, real or
apparent, would be involved.
No covered persons who exercise or have exercised any functions or responsibilities with respect
to CDBG-assisted activities, or who are in a position to participate in a decision-making process
or gain inside information with regard to such activities, may obtain a financial interest in any
contract, or have a financial interest in any contract, subcontract, or agreement with respect to the
CDBG-assisted activity, or with respect to the proceeds from the CDBG-assisted activity, either
for themselves or those with whom they have business or immediate family ties.
For purposes of this paragraph, a"covered person"includes any person who is an employee,
agent, consultant, officer, or elected or appointed official of the City, the Contractor, or any
designated public agency.
Lobbying
The Contractor hereby certifies that:
No member or delegate to the Congress of the United States, and no resident Commissioner,
shall be admitted to any share or part of this Agreement, or to any benefit to arise therefrom.
No member of the governing body of the City, no officer, employee, official or agent of the City,
or other local public official who exercises any functions or responsibilities in connection with
review, approval, or carrying out of the Project to which this Agreement pertains, shall have any
private interest, direct or indirect, in this Agreement, while in office and for one year after
holding the position.
8
No federal funds appropriated under this Agreement shall be paid, by or on behalf of the
Contractor, to any person for influencing or attempting to influence a member of Congress an
officer or employee of Congress or any federal agency in connection with the awarding of any
federal contract, the making of any federal grant,the making of any federal loan, the entering
into any cooperative agreement, and the extension, continuation, renewal, amendment or
modification of any federal contract, loan, grant or Agreement
Copyright
If this agreement results in any copyrightable material or inventions, the City reserves the right to
royalty- free, nonexclusive and irrevocable license to reproduce, publish, or other wise use and to
authorize others to use,the work or materials for governmental purposes.
Religious Activities
The Contractor agrees that funds provided under this Agreement will not utilized for inherently
religious activities prohibited by 24 CFR 570.200(j), such as worship, religious instruction or
proselytization.
ENVIRONMENTAL CONDITIONS
Air and Water
The Contractor agrees to comply with the following requirements insofar as they apply to the
performance of this Agreement: Clean Air Act, 42 U.S.C., 7401, et seq.;
Federal Water Pollution Control Act, as amended, 33 U.S.C., 1251, et seq., as amended, 1318
relating to inspection, monitoring, entry, reports, and information, as well as other requirements
specified in said Section 114 and Section 308, and all regulations and guidelines issued
thereunder;
Environmental Protection Agency (EPA)regulations pursuant to 40 CFR 50, as amended.
Lead-Based Paint
The Contractor shall comply with requirements of the Federal regulations concerning the Lead-
Based Paint Poisoning Prevention Act and HUD regulations there under:
Department of Housing and Urban Development(24 CFR Part 35)Requirements for
Notification, Evaluation and Reduction of Lead-Based Paint Hazards in Federally Owned
Residential Property and Housing Receiving Federal Assistance, and Environmental Protection
Agency (40 CFR Part 745) Lead; Requirements for Hazard Education before Renovation of
Target Housing.
Historic Preservation
The Contractor agrees to comply with the Historic Preservation requirements set forth in the
National Historic Preservation Act of 1966, as amended (16 U.S.C. 470) and the procedures set
9
forth in 36 CFR 800, Advisory Council on Historic Preservation Procedures for Protection of
Historic Properties, insofar as they apply to the performance of this agreement.
In general, this requires concurrence from the State Historic Preservation Officer for all
rehabilitation and demolition of historic properties that are fifty years old or older or that are
included on a Federal, state, or local historic property list. Failure to complete Historic
Preservation Review prior to any choice limiting actions on the project will result in the project
being ineligible for reimbursement.
Environmental Review
The Contractor shall comply with all applicable environmental review requirements of HUD.
The City shall prepare and submit the environmental review. Upon completion of the review the
Contractor will be notified when the project may proceed. Failure to complete an Environmental
Review prior to any choice limiting actions on the project will result in the project being
ineligible for reimbursement.
SEVERABILITY
If one or more of the provisions contained in this Agreement are held to be invalid, illegal or
unenforceable, the provisions of this Agreement shall be deemed severable and the remainder of
the Agreement shall remain in full force and effect.
LIMITATIONS OF CITY LIABILITY - DISCLAIMER OF RELATIONSHIP
The City shall not be liable to the Contractor, or to any party, for completion of or failure to
complete any improvements which are part of the Project. Nothing contained in this Agreement,
nor any act or omission of the City or the Contractor, shall be construed to create any special
duty, relationship,third-party beneficiary, respondent superior, limited or general partnership,
joint venture, or any association by reason of the Contractor involvement with the City.
RESPONSIBILITY FOR PROGRAM REGULATIONS
The Contractor is responsible for all regulations contained in 24 CFR Part 570 as it may be
amended from time to time. The City shall attempt to forward copies of the updated regulations
as they become available, however, the Contractor shall be ultimately responsible for securing
said updates.
Build America, Buy America Act
The Contractor shall comply with the Build America, Buy America Act (BABAA)requirements
under Title IX of the Infrastructure Investment and Jobs Act (IIJA), Pub.L 177-58.
In general this states that all products must meet BABA requirements. The Contractor shall
include Manufacturer's Certification for BABAA requirements with all applicable submittals. If
a specific manufacture is used in the bidding, a statement that the manufacturer will comply with
BABAA must be included in the bid submission.
10
Installation of materials or products that are not compliant with BABAA requirements shall be
considered defective work. Contractor should ensure that all materials has an approved
Manufacturer's Certification or waiver prior to items being delivered to the project site.
SECTION HEADINGS AND SUBHEADINGS
The section headings and subheadings contained in this Agreement are included for convenience
only and shall not limit or otherwise affect the terms of this Agreement.
IN WITNESS WHEREOF,the parties have executed this Contract for Asbestos
Abatement Services as of the date first set forth above.
CITY OF WATERLOO, IOWA ALL STAR ENVIRONMENTAL, LLC
By: D d
Quentin Hart,Mayor Authorized Rep s tative
Attest:
' tly Felc City Clerk
Megy
11
ATTACHMENT 1
SECTION 3 CONTRACT REQUIREMENTS [24 CFR 75]
(24 CFR 75 is applicable to HUD-funded projects awarded ON or AFTER to November 30,
2020)
1. Section 3 of the Housing and Urban Development Act of 1968: The work to be performed
under this contract is subject to the requirements of Section 3 of the Housing and Urban
Development Act of 1968, as amended, 12 U.S.C. 1701u(Section 3). The purpose of Section 3
is to ensure that employment and other economic opportunities generated by the U.S.
Department of Housing and Urban Development(HUD) assistance or HUD-assisted projects
covered by Section 3, shall,to the greatest extent feasible, be directed to low- and very low-
income persons,particularly persons who are recipients of HUD assistance for housing.
2. Contractor Certification of Compliance: The parties to this contract agree to comply with
HUD's regulations in 24 CFR 75, which implement Section 3. As evidenced by their execution
of this contract, the parties to this contract certify that they are under no contractual or other
impediment that would prevent them from complying with the 24 CFR 75 regulations.
3. Contract Language Requirement: The contractor agrees to include this Section 3 Contract
Requirements clause in every sub-contract subject to compliance with regulations in 24 CFR 75,
and agrees to take appropriate action, as provided in an applicable provision of the sub-
contractor in this Section 3 Contract Requirements clause, upon a finding that the sub-contractor
is in violation of the regulations in 24 CFR 75. The contractor will not sub-contract with any
subcontractor where the contractor has notice or knowledge that the sub-contractor has been
found in violation of the regulations in 24 CFR 75.
4. Contracting Requirements: To the greatest extent feasible, and consistent with existing
Federal, state, and local laws and regulations, the CDBG Grantee and contractors and sub-
contractors for the CDBG project shall ensure contracts and sub-contracts for work awarded in
connection with the project are awarded to business concerns that provide economic
opportunities to Section 3 Workers; and where feasible in the following order of priority: (1)
Section 3 Business concerns that provide economic opportunities to Section 3 Workers residing
within the metropolitan area(or nonmetropolitan county) in which the HUD funded assistance is
provided/in which the HUD funded/CDBG project is occurring; and (2) YouthBuild programs.
5. Employment and Training Requirements: To the greatest extent feasible, and consistent
with existing Federal, state, and local laws and regulations, the CDBG Grantee and contractors
and sub-contractors for the CDBG project shall ensure employment and training opportunities
generated in connection with the project are filled by Section 3 Workers; and where feasible, in
the following order of priority: (1) low- and very low-income persons residing within the
metropolitan area(or nonmetropolitan county) in which the CDBG assistance is expended (i.e.,
in which the CDBG project is occurring); and (2)participants in YouthBuild programs.
6. Section 3 Definitions [24 CRF 75]: Definitions for Section 3 terms per 24 CFR 75 are as
follows:
Section 3 Worker: An employee who currently fits (if hired more than five (5)years before
starting work on the CDBG project), or fit at the time of hire (if hired within five (5)years of
starting work on the CDBG project), at least one (1) of the following categories: (1) is employed
by a Section 3 Business concern; or(2) is a low- or very low-income resident(i.e., a local person
living within the Section 3 service area as defined in 24 CFR 75.5, with an individual annualized
income at the time of hire (if hired within five (5)years of starting work on the CDBG project),
12
or currently as of date of starting work on the project (if hired more than five (5) years before
starting work on the CDBG project)that was/is at or below the low income (80%)threshold
established by HUD for a Family of 1 for the county in which the person lives) [Note: The HUD
income threshold must be from the HUD Income Limits for the CDBG program that are in effect
at the time of hire (if hired within five (5)years of starting work on the CDBG project), or
currently in effect as of the date the worker started work on the CDBG project (if hired more
than five (5)years prior to starting work on the CDBG project). The HUD Income Limits are
updated annually,typically in March or April.]; or(3) is a YouthBuild participant.
Targeted Section 3 Worker: An employee who is employed by a Section 3 Business concern; or
who currently fits (or when hired fit) at least one (1) of the following categories as documented
within the past five (5)years: (1) lives/lived within the Section 3 service area or the
neighborhood of the CDBG project as defined in 24 CFR 75.5; or (2) is a YouthBuild
participant.
Section 3 Business concern: A business that fits at least one (1) of the following categories: (1)
51% or more owned by low- or very low-income persons; or(2) 75% or more of the labor hours
are performed by low- or very low-income persons; or(3) 51% or more owned by current
residents of public housing or Section 8-assisted housing.
Section 3 Service Area: An area within one (1) mile of the CDBG project's location (i.e., street
address); or an area within a circle centered around the CDBG project site that encompasses
5,000 people [if less than 5,000 people live within a one (1)mile radius of the CDBG project
site].
7. Reporting Labor Hours: CDBG Grantee and contractors and sub-contractors for the CDBG
project shall report all worker(see exception on next page)* labor hours on the project as
follows: (1) the total number of labor hours worked; (2)the total number of labor hours worked
by Section 3 Workers; and(3)the total number of labor hours worked by Targeted Section 3
Workers. The labor hours reported shall include the total number of labor hours worked on the
financially assisted project by workers employed by the CDBG Grantee, and employed by their
contractors and sub-contractors, during the reporting period specified by HUD and the State
CDBG Program. The labor hours reported may be based on the employer's good faith
assessment of the labor hours of a full-time or part-time employee informed by the employer's
existing salary or time and attendance based payroll systems, unless the project or activity is
otherwise subject to requirements specifying time and attendance reporting. [Note: Construction
contractors required to maintain certified payroll records to meet federal labor standards
requirements shall report actual work hours as reported on the certified payroll records.]
*Exception for positions that require an advanced degree or professional certification:
Reporting of hours for positions requiring an advanced degree or professional certification is
not required, but the hours may be reported to demonstrate Section 3 "best efforts". The CDBG
Grantee, contractors and sub-contractors may report the labor hours by Section 3 Workers and
Targeted Section 3 Workers without including labor hours from employees in positions requiring
an advanced degree or professional certification in the total number of labor hours worked, but
if the contract covers both work requiring an advanced degree or professional certification and
other work the labor hours for the other work under the contract that are not from employees in
positions requiring an advanced degree or professional certification must still be reported
8. Section 3 Benchmarks: The HUD Section 3 Final Rule (24 CFR 75) establishes "safe
harbor"benchmarks that are quantitative benchmarks and prioritized qualitative efforts that
funding recipients must complete to assist low- and very low-income persons with employment
and training opportunities: (1) 25% or more of all labor hours worked must be worked by
•
13
Section 3 Workers; and (2) 5% or more of all labor hours worked must be worked by Targeted
Section 3 Workers. If the "safe harbor"benchmarks are not met over the course of the project,
then the CDBG Grantee and contractors and sub-contractors for the CDBG project shall provide
evidence of completing qualitative efforts to assist low- and very low-income persons with
employment and training opportunities. Supporting documentation of these completed efforts
must also be maintained in the CDBG Grantee's and contractors' CDBG project files,to be made
available upon request for monitoring purposes.
9. Demonstrating Best Efforts: When the Section 3 benchmarks are not met, the CDBG
Grantee and contractors and sub-contractors for the CDBG project shall demonstrate and report
qualitative efforts made in an attempt to meet the benchmarks, which may include but are not
limited to the following:
(1)Engage in outreach efforts to generate job applicants who are Targeted Section 3 Workers.
(2) Provide training or apprenticeship opportunities.
(3) Provide technical assistance to help Section 3 Workers compete for jobs (e.g., resume
assistance, coaching).
(4) Provide or connect Section 3 Workers with assistance in seeking employment including:
drafting resumes, preparing for interviews, and finding job opportunities connecting residents to
job placement services.
(5) Hold one or more job fairs.
(6) Provide or refer Section 3 Workers to services supporting work readiness and retention(e.g.,
work readiness activities, interview clothing, test fees, transportation, child care).
(7) Provide assistance to Section 3 Workers to apply for/or attend community college, a four-
year educational institution, or vocational/technical training.
(8) Assist Section 3 Workers to obtain financial literacy training and/or coaching.
(9) Engage in outreach efforts to identify and secure bids from Section 3 Business concerns.
(10) Provide technical assistance to help Section 3 Business concerns understand and bid on
contracts. (11) Divide contracts into smaller jobs to facilitate participation by Section 3 Business
concerns.
(12) Provide bonding assistance, guaranties, or other efforts to support viable bids from Section 3
Business concerns.
(13) Promote use of business registries designed to create opportunities for disadvantaged and
small businesses.
(14) Conduct outreach, engagement, or referrals with the state one-stop system as defined in
Section 121(e)(2) of the Workforce Innovation and Opportunity Act.
10. Recordkeeping & Reporting: The CDBG Grantee and contractors and sub-contractors for
the CDBG project shall maintain all records demonstrating compliance with 24 CFR 75,
including contracting information and documents, worker income certifications (for Section 3
Worker status determinations), and worker labor hours on CDBG project; and provide data and
reporting documents as requested and required by the State CDBG Program and/or HUD.
Grantee and contractor records may be monitored for compliance by the State CDBG Program
and/or HUD.
11. Non-Compliance: Non-compliance with HUD's regulations in 24 CFR 75 may result in
sanctions, termination of this contract for default, and debarment or suspension from future HUD
assisted contracts.
12. Indian Housing Assistance Project Specifications: With respect to work performed in
connection with Section 3 covered Indian housing assistance, Section 7(b) of the Indian Self-
Determination and Education Assistance Act(25 U.S.C. 450e) also applies to the work to be
performed under this contract. Section 7(b) requires that to the greatest extent feasible: (i)
14
preference and opportunities for training and employment shall be given to Indians; and (ii)
preference in the award of contracts and sub-contracts shall be given to Indian organizations and
Indian-Owned Economic Enterprises. Parties to this contract that are subject to the provisions of
Section 3 and Section 7(b) agree to comply with Section 3 to the maximum extent feasible, but
not in derogation of compliance with section 7(b).
**This language is required to be included in contracts and sub-contracts for a HUD funded project that are funded in whole or
in part with the federal dollars,and the CDBG/HUD Funded Award to the Grantee is greater than$200,000 and awarded
11/30/2020 or later,and the CDBG/HUD Funded Project includes construction(including building/structural rehabilitation)
and/or demolition activities. CDBG projects awarded on or after 11/30/2020,for which the CDBG/HUD funded Award is less
than$200,000 and/or for which Planning,Public Services,or Financial Assistance(e.g.,loans for economic development)are the
only activities,with no construction and no demolition in the project scope of work,are not subject to these Section 3
requirements and reporting. Insertion of this Section 3 Clause is strongly recommended to be included in ALL contracts and sub-
contracts for a HUD funded project that is subject to Section 3 requirements,regardless of the funding source for the specific
contract,to help avoid issues with compliance and reporting later in the project cycle if the funding source changes. All
subcontractors of a prime contractor that is funded in whole or in part with CDBG/HUD funding are subject to the same Section
3 requirements as the prime contractor.
15