WPC0- vNUZS.sZi*/Un*+v=q%?#S^wH#3t?wUP_QlT;_$h7sl8V/Hm?\k`meB ]%fkO |1칉rfD'!nUӅ䒮c 3#eRPh4wyR-B-&"u4-Z n- <&\^Ď8Xܰh;PO`< :1ݐ}[.G{8S0QVoe[˴I?o g\6WHbьKuQ65A'DSx ** K%+0A ^z2߹r>&WK2"%x!3 &E^a3mWU /p+a*e]oqPג3ܕݦHdٯxdЃRK¼f2{, ԍ`!4R-הufUNv % 0(f 0DE8 f: a< fP aR f 0g, 0@ w 4  m  0l 0Dv f a f a  { a f 1 0U au 72UBU@ 0(#N B 0 0 0e 1 72 0=6 1u 72| 0c 0^  0 0q 0 0 0l 07 0 0 0, 0 0\ 0 0r! 0." 0" 0# 0D$ 0$ 0z% 0 & 0& 0<' 0HX' 0' B-(U>((( ) ))) 0T, B*T,T,T,T, 0f~,~,~,~,~,~,~,~,~,~,~,~,~,~,~,~,~,~,~,~,~,~,~,~,~,~,~, 0L,3|xx9 Z6Times New Roman RegularX($(3$ !  pTABLE ATABLE Ba, b, c,Level 1Level 2Level 3Level 4Level 56#)4Quick a)    )0  2b0Quick 0 \3~U $    1    _XXԀTheFederalpolicyistoretainthesereportsfornotmorethatthreeyears[FARPart42.1503(e)]#X79XS#.((3$ !      0  (#$  0  TABLE DTABLE C _XX2SeeFTAMasterAgreementMA(12),10105,Section10forSingleAnnualauditrequirements. TABLE G(EhCEKQW]cioAutoList21.1.1.1.1.1.1.1.*+ (_2623  ..TABLE F1.  '  _#X79XXX   #X#X79BestPracticesProcurementManualChapter10Closeoutf!f!f!(#Page  1  ##X79X#e#Ԉ  A()  xdEs xA#X79XX#X79+# t , ,XX79X79X ,,\  `*Times New RomanTT(hH  Z(Times New Roman *D+D (_25   ," <DL,23  ..," <DL,   HP LaserJet 5,,,,0 d*5+5 (_24  ) <DL)23  ..) <DL)  *2+2 (_23 ` &<<DL&23  ..&<<DL& ` */+/ (_22  #DL#23  ..#DL#  (5hCEKQW]cioAutoList11.1.1.1.1.1.1.1.,1.&$""0  3#37=CIQYag1.a.i.(1)(a)(i)1)a)/i)(;3$2#  0  .3  0  *,+, (_21   DL 23  .. DL  Ӄ63  *)+) (_20 h DDL23  ..DDL h *&+& (_19  L23  ..L  *#+# (_18   L23  .. L  *>> (_17  2( 4 <DL223  Ԁ2( 4 <DL2  *DD (_16   ," <DL,23  Ԁ," <DL,   *55 (_15  ) <DL)23  Ԁ) <DL)  *22 (_14 ` &<<DL&23  Ԁ&<<DL& ` *// (_13  #DL#23  Ԁ#DL#  *,, (_12   DL 23  Ԁ DL  *)) (_11 h DDL23  ԀDDL h *&& (_10  L23  ԀL  (## &_9   L23  Ԁ L  (>> &_8  2( 4 <DL223  2( 4 <DL2  (DD &_7   ," <DL,23  ," <DL,   (55 &_6  ) <DL)23  ) <DL)  (22 &_5 ` &<<DL&23  &<<DL& ` (// &_4  #DL#23  #DL#  (,, &_3   DL 23   DL  ()) &_2 h DDL23  DDL h (&& &_1  L23  L  &## $_   L23   L  <:Default Para<:footnote ref  <bb:footnote tex   2( 4 <DL2  2( 4 <DL2  )Hairline d\  `&Times New Roman $    4    _ԀXX49_CFR_Ԁ18.36(_i_)(11).#X79XT#  $    3    _ԀMX79XXXMXMX79ThesetermsaredefinedintheMA,Section1.mand1.p.Granteesmustensuretheircontracttermsand  procurementpoliciesclearlyrequirerecordretentionforthreeyearsafterthefinalcontractpaymentismadeandnot  aftercompletionofwork.#MT##X79Xs#(W$     &p d Pd(W$ @*   A >b$Large Circle0 !  _ $XmXXX"P   Chapter10 1 10-Closeout     10.1CloseoutProcedures(7/99)     10.2Audits(7/99)     10.3RecordRetention(4/05)    10.1CLOSEOUTPROCEDURES `  *( ddd Xdd Xdd X(#(#,xdd +  i8 i8   REQUIREMENT (   (*e ( ddxdd x( (#(#e,xdd +     49_CFR_ԀPart18.50,Closeout,addressestherequirementsthatgranteesmustadheretointhe M  closeoutoftheirgrants.Inordertocomplywiththeserequirements,granteeswillhaveto 9  obtaintherequiredinformation,reports,finalinvoices,andotherdocumentationasappropriate %  fromtheirthirdpartycontractorsaspartofthecontractcloseoutprocess.Thecloseout   informationrequiredbyFTAfromgranteespertainstothefollowing:   (Eh83/*,X XX*"13"   l 13|2Eh  1  .3  0    Finalperformanceorprogressreport.13|݌"" Ќ   l 2.  FinancialStatusReport. 7  l 3.  Finalrequestforpayment. h  l 4.  Inventiondisclosure(ifapplicable).    l 5.0  Federally-ownedpropertyreport(doesnotincludepropertyobtainedwithgrant ], funds).#I"" #. X,X XR. DISCUSSION Q  Acompletedcontractisonethatisbothphysicallyandadministrativelycomplete.A )" contractisphysicallycompleteonlyafteralldeliverableitemsandservicescalledforunder # thecontracthavebeendeliveredandacceptedbythegrantee.Thesedeliverableitems $  includesuchthingsasreports,spareparts,warrantydocuments,andproofofinsurance $! (whererequiredbythecontractterms).Thesedeliverableitemsmayormaynothavebeen %" pricedasdiscretepayitemsinthecontract,buttheyarerequireddeliverables,andthe &# contractisnotphysicallycompleteuntilalldeliverablesaremade.Acontractis ' $ administrativelycompletewhenallpaymentshavebeenmadeandalladministrativeactions (l!% accomplished.Thestepsthatmustbecompletedtocloseoutacontractwilldependupon )X"& thetypeand/ornatureofthecontract. u*D#'   Routinecommodity_procurements_ - Thecloseoutofroutinepurchaseordersandcontracts M,%) forcommoditiesandothercommercialproductsisusuallyastraightforwardand =- &* uncomplicatedprocess.Theprocurementpersonresponsibleforcloseoutwillneedto ).&+ ensurethathisenditemuserhasinspectedandacceptedthedeliverableitemsasbeingin /', _conformancewiththepurchaseorder/contractspecifications.Aninspection/acceptance 1 formshouldbeinthefileattestingtothecontractor'sdeliveryofallcontractenditems,  includinganydescriptiveliteratureorwarrantydocumentation.Theremustalsobe   documentationattestingtofinalpaymentbytheaccountspayabledepartment.   Non-routinecontractsforservices,construction,rollingstock,etc.-Contractsforpersonal   services,complexequipment,construction,andotherone-of-kinditemswillrequirea   numberofstepstoeffectanadministrativecloseout.Majorelementsofthecloseout  t process,andrelateddocumentation,mightinclude:  `   )  *,XX4` XX*   ) a  )0 4   Resolutionofallcontractchanges,claims,andfinalquantitiesdelivered. ) یi8 4(#4(# Ќ    b)0 4 Determination/recoveryofliquidateddamages.A 4(#4(#   )  0   ) c  )04(#(#  Reviewoftheinsuranceclaimfilebycounsel/insurancespecialisttodetermineif   fundsneedtobewithheldfromfinalpaymenttocoverunsettledclaimsagainst   thecontractor. ) ی4(#4(# Ќ    d)0 4 Settlementofallsubcontractsbyprimecontractor.4(#4(#   e)0 4 Performanceofallinspections(andacceptancetestsifany)bythegrantee's p projectmanagementoffice,withappropriatedocumentation.\4(#4(#   f)0 4 Conductofacostauditforcost-reimbursementcontractsandresolutionof e4 questionedcosts,ifany.Q 4(#4(#   g)0 4 GenerationofaContractorPerformanceReport.SeeBestPracticebelow.)4(#4(#   h)0 4 ThesubmittalofallrequireddocumentationbytheContractor,includingsuch ! itemsas:!4(#4(#  .  0   4 .b"0` (#(#  Finalreports.b݌#` (#` (# Ќ  0   4  (#(# .  0   4 .M"0` (#(#  Finalpayrollrecordsandwageratecertifications.M݌%l!` (#` (# Ќ     4 .  0   4 .D"0` (#(#  Sparepartslist.Dw݌u'D #` (#` (# Ќ     4 .  0   4 ."0` (#(#  Manufacturer'sWarrantiesandGuarantees.L݌M)"%` (#` (# Ќ     4 .  0   4 ."0` (#(#  Finalcorrectedshopdrawings.9݌%+#'` (#` (# Ќ     4 .  0   4 ."0` (#(#  Operationandmaintenancemanuals.݌,%)` (#` (# Ќ   -&* .  0   4 ."0` (#(#  Cataloguesandbrochures.݌` (#` (# Ќ  .  0   4 ."0` (#(#  Inventiondisclosure(ifapplicable).݌ ` (#` (# Ќ     4 .  0   4 .y "0` (#(#  Federally-ownedpropertyreport(iftherewasGovernment-furnished   property).y ݌ ` (#` (# Ќ     4 .  0   4 .!"0` (#(#  Resolutionoffinalquantities(constructioncontracts).!!݌`` (#` (# Ќ     4 .  0   4 .""0` (#(#  Finalinvoice.""݌i8 ` (#` (# Ќ     4 .  0   4 .l#"0` (#(#  ConsentofSuretytoreleasefinalpaymenttoContractor.l##݌A ` (#` (# Ќ     4 .  0   4 .j$"0` (#(#  Contractor'sAffidavitofReleaseofLiens.j$$݌ ` (#` (# Ќ    .  0  04(#(#.M%"0` 4(#4(#  Contractor'sGeneralRelease(releasingthegranteefromanyfurther  liabilities/claimsunderthecontract).M%%݌` (#` (# Ќ     4   .  0   4 .&"0` (#(#  MaintenanceBond(ifrequired) .&&݌` (#` (# Ќ  0  04(#(#  i) 4 ConductaPost-deliveryAuditforrollingstockcontractsasrequiredby49CFR \ Part663-Pre-awardandPostdeliveryAuditsofRollingStockPurchases.yH4(#4(#   Federalcloseoutprocedures-Shouldthegranteewishtoreviewthecontractcloseout Q  proceduresusedbytheFederalGovernmentforitscontracts,theymaybefoundinFAR =  Part4.804,Closeoutofcontractfiles.FARPart42.15,ContractorPerformanceInformation, ) discussesthepreparationofContractorPerformanceReports.Theseproceduresarenot   bindingongrantees,andareincludedhereforinformationpurposesonly. !  BestPractices  " EstablishingThataContractIsCompleted-ItisgenerallytheresponsibilityoftheProject $  Manager(PM)toestablishthattheworkunderacontracthasbeencompletedandthecontractis %l! readyforcloseout.WhenthePMdeterminesthattheworkiscomplete,thePMshouldpreparea &X" checklistshowingallthecontractdeliverablesandsubmittals,andindicatingonthechecklistthat u'D # allsubmittalsanddeliverableshavebeenreviewed,inspectedandaccepted.ThePMshould a(0!$ notifythecontractadministratorbymemorandumthatthecontractiscompleteandallrequired M)"% deliverableshavebeeninspectedandaccepted. 9*#& ContractCloseoutChecklist-ThePMorcontractadministratorshouldhaveacontractcloseout ,$( checklist,listingalltheadministrativestepsrequiredtocloseoutacontract.Thechecklistisan ,%) extremelyusefultoolforthecontractadministratororprojectmanagerwhoisresponsiblefor -&* contractcloseout.Giventhedifferentrequirementsforthevariouscontractingsituations, .'+ granteesmaywishtohavedifferentchecklistsfordifferenttypesofcontracts;e.g.,commodities, 1 services,construction,cost-typecontracts,etc.Anexampleofacontractcloseoutchecklistused  byMARTAforconstructioncontractsisshowninAppendixB.14.   ContractorPerformanceReport-Documentationofacontractor'sperformanceforfuturesource   selectiondecisionsisanoptionthatgranteesshouldconsiderforcertaintypesofprocurements   suchasprofessionalservices,complexequipment,construction,etc.Theseperformancereports   canbeanimportantreferencepointforfuturesource-selectiondecisions.SeeBPPMSection5.1,  t ResponsibilityofContractor.Ifthegranteechoosestodocumentacontractor'sperformance, ` inputtothereportshouldbereceivedfromthetechnicaloffice,contractingoffice,disadvantaged }L  businessoffice(ifcontractcontainedDBErequirements)andendusersoftheproductorservice i8  (ifappropriate).Contractorsshouldbefurnishedwiththereportandgivenanopportunityto U$  submitcomments,rebuttingstatementsoradditionalinformation.TheContractor'scomments A  shouldberetainedinthereportfile.Itwouldbeadvisabletohaveareviewlevelabovethe -  granteeProcurementOfficertoconsiderdisagreementsbetweenthepartiesregardingthe   evaluation.However,finaldecisiononthecontentofthereportmustrestwiththegrantee.   CopiesofthefinalevaluationshouldbefurnishedtotheContractor.Granteesshouldhaveatime  limitontheretentionofthesereports. #  1        Reviewbylegalcounsel-Forprocurementsinvolvingservices,construction,andlargerdollar  valueequipmentpurchases,granteesmaywishtohavetheirlegalcounselreviewthecloseout p filetoensuretheadequacyofthecontractor'slegaldocuments,includingthecontractor'sgeneral \ release,insurancecertificates,surety'srelease,maintenancebonds,etc. yH Proofofinsurancecoverage-ForallcontractsrequiringtheContractortomaintaininsurancefor Q  itsproductsorservices(e.g.,professionalliabilityorproductliabilityinsurance),thecontract =  administratorshouldobtainproofofinsurancefromtheContractoraspartofthecloseout ) process.Thisdocumentationshouldbesubmittedtothegrantee'sInsuranceDepartmentfor   approvalpriortofinalpaymentoftheContractor.TheInsuranceDepartmentwillberequiredto ! maintainthesedocumentsas"active"filesuntilsuchtimeastheinsurancerequirementceases ! underthetermsandconditionsofthecontract;i.e.,theseinsurancetermswillcontinuepast " (survive)thefinalcontractpayment. # Finalpayment-Thecontractadministrator(CA)mustbesurethatalladministrativestepshave %l! beenaccomplishedpriortofinalpayment.Contractadministratorsshouldmakeuseofacontract &X" closeoutchecklisttotheextentthattheProgramManager'schecklistdoesnotcovereverythingin u'D # thecloseoutprocess(e.g.,thecontractadministratormayhavecertainareasofconcernnot a(0!$ assignedtotheProgramManager).TheCAmustensurethatallrequiredinspectionshavebeen M)"% performedbythetechnicalprogramoffice,andamemorandumhasbeenreceivedfromthe 9*#& projectmanagercertifyingtothesatisfactorycompletionofthecontract,whichincludesall  %+#' requireddocumentationfromtheContractor,beforetheyauthorizefinalpaymentortherelease 1 ofanyfundsbeingretainedunderthecontract.Contractadministratorsneedtopaycareful  attentiontothosetypesofdocumentsthatarenotoriouslyproblematic,suchaswarranties.In   fact,granteesmaywishtoconsidermakingthesewarrantydocumentsapayitemintheir   contractswhenthecontractpayitemsarebeingestablished,sothattheContractorwillbe   motivatedtodeliverthedocumentsinatimelymanner,andtherewillbenodisputeastothe   properamountthatshouldbepaidfortheseitems.   Contractor'sGeneralRelease-Aspartofthecontractcloseoutprocess,thecontractadministrator ` mustsendtheContractoracloseoutletterthatincludestheContractor's"generalrelease."This }L  documentmustbeastandardstatementpreparedbythegrantee'slegalcounselforuseonallof i8  thegrantee'scontracts.Thereleasewillsaythatforthepaymentofasumcertain,whichisthe U$  finalcontractamountagreedtobybothparties,theContractorreleasesthegranteefromanyand A  allclaimsofeverykindarisingdirectlyorindirectlyoutofthecontract.Thereleasemayalso -  containacertificationthatthecontractorhaspaiditssubcontractorsandsuppliersforalltheir   labor,materials,services,etc.furnishedunderthecontract.Thereleaseistobesignedbya   corporateofficialauthorizedtobindtheContractor.Thegeneralreleaseisimportanttoobtain  priortofinalpaymentbecauseitassuresthegranteethattherewillbenofurtherclaimsfromthe  Contractoroncethefinalpaymenthasbeenmade.Thegranteeshouldhavethereleasereviewed  byitslegalcounseliftheContractormakesanychangestothegrantee'sstandardrelease  languagethatwassenttotheContractorforsignature.Ofcourseitwillbenecessaryforthe p granteeandtheContractortohaveresolvedallopenissuesofafinancialnaturepriortothe \ executionoftherelease(changeorders,claims,liquidateddamages,etc.),andthisresolutionof yH alloutstandingclaimsisanimportantstepinthecontractcloseoutprocess. e4 Retainageandtheproblemofcontractorswhoquitwork-Occasionallyaconstructioncontractor =  may"walkaway"fromaprojectthatisalmostcomplete,refusingtosignageneralreleaseand ) forgoingfinalpayment.Thissituationmayoccurwhenthecontractorlackssufficientfinancial   incentivetocompletethecontract;e.g.,ifthe"punchlist"islargeandthereisverylittlemoney ! leftinretainage,thecontractormayprofitbyrefusingtocorrectthepunchlistitemsandleave ! theretainagewiththegrantee.Orthecontractormayhavebeenawardedanothercontractwhich " requiresthereassignmentofhispersonneltoanotherjob.Whateverthereason,thegrantee # shouldanticipatethispossibilitybycarefullyestimatingtheamountofretainageinsuchaway $  thatitrepresentstwicetheamountofthepunchlistworkandundelivereditems(manuals, %l! drawings,spareparts,etc.).Forexample,MARTA'sprocedures(whicharespelledoutinthe &X" contractprovisions)callfortheretainageofatleast5%ofthetotalcontractvalueasthework u'D # progresses(10%ifthereareproblemsobservedwiththework).Atthepointoffinalinspection a(0!$ andpunchlistpreparation,theresidentengineerestimatesthevalueofthepunchlistitemsand M)"% theundelivereditemssuchasspares,manuals,warranties,etc.,andthenMARTApaysoutthe 9*#& retainageminustwicethevalueofalltheunfinishedwork.Byestablishingtheretainageinthis %+#' way,thecontractorismotivatedtocompletethecontract,becausethecontractorwillactually ,$( receivetwicetheamountofmoneythatittakestofinishthework.Inotherwords,thecontractor ,%) isgivenastrongincentivetocompletethecontract.Whenallelsefails,thegranteeshould -&* definitelyinvolvethesuretyintheissueofunfinishedwork(eveniftheamountofwork_is .'+ relativelysmall)becausethecontractor'srelationshipwithitssuretyisavitaloneforitsfuture 1 business.Ifthecontractorlosestheconfidenceofitssurety,itiseffectivelyforeclosingonits  abilitytobidonfutureworkrequiringperformancebonds.   WarrantyandGuaranteeRegister-Thecontractspecificationsmayrequirethatindividual   warrantiesorguaranteesbefurnishedforvariousinstalledequipmentorbuildingsystems.For   eachcompletedcontractrequiringwarranties,thecontractadministratorshoulddevelopa   WarrantyandGuaranteeRegister,whichisastatusformlisting:  t  .  6,XX X,XX4` X60  .U"0(#(#  eachindividualitemofequipmentandsystemforwhichawarrantyorguaranteeis }L  specified(roofing,doors,sealants,etc.);.UDV݌i8 (#(# Ќ    .  0  .[W"0(#(#  thepertinentsectioninthecontractspecification;.[WW݌A (#(# Ќ    .  0  .