[Federal Register Volume 63, Number 179 (Wednesday, September 16, 1998)]
[Proposed Rules]
[Pages 49503-49504]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-24763]


 ========================================================================
 Proposed Rules
                                                 Federal Register
 ________________________________________________________________________
 
 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
 
 ========================================================================
 

  Federal Register / Vol. 63, No. 179 / Wednesday, September 16, 1998 / 
Proposed Rules  

[[Page 49503]]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF AGRICULTURE

Rural Utilities Service

7 CFR Part 1726


Revision of Electric Program Standard Contract Forms

AGENCY: Rural Utilities Service, USDA.

ACTION: Advanced Notice of Proposed Rulemaking.

-----------------------------------------------------------------------

SUMMARY: The Rural Utilities Service (RUS) requires borrowers to use 
standard forms of contracts promulgated by RUS when contracting for 
construction, procurement, engineering services, or architectural 
services financed through loans made or guaranteed by RUS, in 
accordance with applicable RUS regulations. RUS is planning to update, 
consolidate, and streamline the standard forms of contracts used for 
construction and procurement.

DATES: Written comments must be received by RUS, or bear a postmark or 
equivalent, no later than November 16, 1998.

ADDRESSES: Written comments should be addressed to F. Lamont Heppe, 
Jr., Director, Program Development and Regulatory Analysis, Rural 
Utilities Service, U.S. Department of Agriculture, Stop 1522, 1400 
Independence Avenue, SW., Washington, DC 20250-1522. Telephone: (202) 
720-9550. RUS requires a signed original and three copies of all 
comments (7 CFR 1700.4). Comments will be available for public 
inspection during regular business hours (7 CFR 1.27(b)).

FOR FURTHER INFORMATION CONTACT: Fred J. Gatchell, Deputy Director, 
Electric Staff Division, Rural Utilities Service, U.S. Department of 
Agriculture, Stop 1569, 1400 Independence Ave., SW., Washington, DC 
20250-1569. Telephone: (202) 720-1398. FAX: (202) 720-7491. E-mail: 
[email protected].

SUPPLEMENTARY INFORMATION:

Background

    The standard loan agreement between RUS and its electric borrowers 
provides that, in accordance with applicable RUS regulations, the 
borrower shall use standard forms of contracts promulgated by RUS for 
construction, procurement, engineering services, and architectural 
services financed by a loan made or guaranteed by RUS. RUS also 
publishes forms of contracts which serve as guidance to borrowers and 
which borrowers may use at their discretion. RUS is planning to update, 
consolidate, and streamline the standard forms of contracts used for 
construction and procurement. The forms included in this effort are:

Primary Contract Forms

    1. RUS Form 198, Rev. 2-95, Equipment Contract. This form is used 
for equipment purchases.
    2. RUS Form 200, Rev. 2-95, Construction Contract--Generating. This 
form is used for generating plant construction or for the furnishing 
and installation of major items of equipment.
    3. RUS Form 201, Rev. 2-95, Right-of-Way Clearing Contract. This 
form is used for distribution line right-of-way clearing work, which is 
to be performed separate from line construction.
    4. RUS Form 203, Rev. 2-95, Transmission System Right-of-Way 
Clearing Contract. This form is used for transmission right-of-way 
clearing work, which is to be performed separate from line 
construction.
    5. RUS Form 257, Rev. 2-95, Contract to Construct Buildings. This 
form is used to construct headquarters buildings and other structure 
construction.
    6. RUS Form 764, Rev. 2-95, Substation and Switching Station 
Erection Contract. This form is used to construct substations and 
switching stations.
    7. RUS Form 786, Rev. 2-95, Electric System Communications and 
Control Equipment Contract. This form is used for delivery and 
installation of equipment for system communications.
    8. RUS Form 790, Rev. 2-95, Distribution Line Extension 
Construction Contract (Labor and Materials). This form is used for 
limited distribution construction accounted for under work order 
procedure.
    9. RUS Form 792, Rev. 2-95, Distribution Line Extension 
Construction Contract (Labor Only). This form is used for limited 
distribution construction accounted for under work order procedure.
    10. RUS Form 830, Rev. 2-95, Electric System Construction Contract 
(Labor and Materials). This form is used for distribution and 
transmission line project construction.
    11. RUS Form 831, Rev. 2-95, Electric Transmission Construction 
Contract (Labor and Materials). This form is used for transmission line 
project construction.

Other Contract Forms

    1. RUS Form 168b, Rev. 2-95, Contractor's Bond. This form is used 
to obtain a surety bond and is included in RUS Forms 200, 201, 203, 
257, 764, 786, 790, 792, 830, and 831.
    2. RUS Form 168c, Rev. 2-95, Contractor's Bond (less than $1 
million). This form is used in lieu of RUS Form 168b to obtain a surety 
bond when contractor's surety has accepted a Small Business 
Administration guarantee.
    3. RUS Form 180, Rev. 2-95, Construction Contract Amendment. This 
form is used to amend distribution line construction contracts.
    4. RUS Form 181, Rev. 2-95, Certificate of Completion, Contract 
Construction for Buildings. This form is used for the closeout of RUS 
Form 257.
    5. RUS Form 187, Rev. 2-95, Certificate of Completion, Contract 
Construction. This form is used for the closeout of and is included in 
RUS Forms 200, 203, 764, 786, 830, and 831.
    6. RUS Form 213, Rev. 2-95, Certificate (``Buy American''). This 
form is used to document compliance with the ``Buy American'' 
requirement.
    7. RUS Form 224, Rev. 2-95, Waiver and Release of Lien. This form 
is used for the closeout of and is included in RUS Forms 200, 203, 764, 
786, 830, and 831.
    8. RUS Form 231, Rev. 2-95, Certificate of Contractor. This form is 
used for the closeout of and is included in RUS Forms 200, 203, 764, 
786, 830, and 831.
    9. RUS Form 238, Rev. 2-95, Construction or Equipment Contract 
Amendment. This form is used to amend contracts except distribution 
line construction contracts.
    10. RUS Form 251, Rev. 2-95, Material Receipt. This form is used to 
document receipt of owner furnished

[[Page 49504]]

materials and is included in RUS Forms 764, 830, and 831.
    11. RUS Form 254, Rev. 2-95, Construction Inventory. This form is 
used for the closeout of RUS Forms 203, 764, 830, and 831. This form is 
available from RUS.
    12. RUS Form 307, Rev. 2-95, Bid Bond. This form is used to obtain 
a bid bond and is included in RUS Forms 200, 203, 257, 764, 830, and 
831.
    13. RUS Form 792b, Rev. 2-95, Certificate of Construction and 
Indemnity Agreement. This form is used for the closeout of and is 
included in RUS Forms 201, 790, 792.
    14. RUS Form 792c, Rev. 2-95, Supplemental Contract for Additional 
Project. This form is used to amend and is included in RUS Forms 201, 
790, 792.

Guidance Forms

    1. RUS Form 172, Rev. 9-58, Certificate of Inspection, Contract 
Construction. This form is used to notify RUS that construction is 
ready for inspection.
    2. RUS Form 173, Rev. 3-55, Materials Contract. This form is used 
for distribution, transmission, and general plant material purchases.
    3. RUS Form 274, Rev. 6-81, Bidder's Qualifications. This form is 
used to document bidder's qualifications.
    4. RUS Form 282, Rev. 11-53, Subcontract. This form is used for 
subcontracting.
    5. RUS Form 458, Rev. 3-55, Materials Contract. This form is used 
to obtain generation plant material and equipment purchases not 
requiring acceptance tests at the project site.
    Our plans for revising and updating these forms include:
    1. Eliminate unneeded forms. This would include merging the Form 
181 into the Form 187, merging the Form 180 into the Form 238, merging 
the Form 201, 203, and 764 into the Form 830, and eliminating Forms 
181, 180, 201, 203, and 764. We are also considering eliminating 
infrequently used guidance forms (Forms 172, 173, 274, 282, and 458.)
    2. Make forms suitable for ``subject to'' or ``not subject to'' RUS 
approval. This would include merging the Form 831 into the Form 830 and 
eliminating Form 831.
    3. Make construction contract forms suitable for ``labor only'' or 
``labor and material.'' This would include merging the Form 792 into 
the Form 790 and eliminating Form 792.
    4. Standardize tables and information pages and incorporate them as 
separate attachments. We are considering publishing the ``Construction 
Units'' pages as a separate bulletin. This would allow the borrower to 
include in the bid package only those construction unit pages that are 
relevant to a particular project.
    5. Maximize consistency among forms. This would include 
standardizing common provisions and terminology, and adding a ``Notice 
and Instructions to Bidders'' to forms not having one.
    6. Include an estimated or base quantity provision in unit price 
contract forms.
    7. Add a provision regarding assignment of the contract to RUS.
    8. Update and clarify contract provisions as necessary. This would 
include:
    a. Clarifying that the contractor (not the owner or engineer) is 
solely responsible for the means and methods of construction and for 
the supervision of the contractor's employees.
    b. Deleting the reference to a ``Supervisor'' appointed by RUS.
    c. Delete the reference to the loan contract and owner's access to 
funding.
    d. Deleting the option for eliminating retainage after the contract 
is 50 percent complete.
    e. Updating the ``Buy American'' requirement.
    f. Eliminating gender specific terms (him, his, materialmen, etc.)
    RUS invites comments from the public about our plans to update, 
consolidate, and streamline the standard forms of contracts listed 
above. We are specifically interested in comments on the following 
questions:
     Are the guidance forms used often or should they be 
eliminated?
     Are there provisions in the contract forms that should be 
updated (in addition to the provisions indicated above)?
     Does the proposed revision/consolidation plan meet the 
needs of most borrowers?

    Dated: September 9, 1998.
Inga Smulkstys,
Acting Under Secretary, Rural Development.
[FR Doc. 98-24763 Filed 9-15-98; 8:45 am]
BILLING CODE 3410-15-P