1. Overview of Common
Procurement and Contract
Administration Issues
1
October 24, 2012
Ivan Chavez
General Engineer

2. Regulatory and Administrative Requirements
24CFR 85.36
Procurement Policy
approved by board
conforms to applicable federal, state and
local law and regulations
covers all phases of procurement activity
from award to close out
 Procurement Handbook 7460.8 r2
 PIH Notices

3. Procurement Planning
 Prepare Cost Estimate and Price Analysis for each
procurement action, including modification
 Cost Estimate: before soliciting bids or proposals
 Price Analysis: after bids are received
 Determine method of procurement to ensure cost
is reasonable
 Confidential

4. Use for Non-Competitive Proposals
 Procurement under other types is not feasible
 After solicitation, number of sources or
competition is determined to be inadequate
 An emergency situation exists
 HUD approves
Non-competitive proposals
must be justified in writing

5. Contract Modifications
 Independent Cost Estimate
 Clear description of proposed work
 Broken down by labor and material
 Fixed price
 Estimate of time of completion
 Additional work must be part of original scope
of work
Above $100,000 must be submitted to HUD

6. Payments to Contractors
 Must have construction progress schedule in
place
 To ensure that scheduled dates and amount of work
to be completed are reasonable and consistent with
contract
Progress payments based on approved
schedule of amounts
Request for payment on form HUD-
51001, periodic estimate for partial payment
Contractor has submitted all certified
payroll reports

7. Inspections
 Frequent inspection of work
Criticalpart of contract to ensure:
Workmanship is acceptable
Materials are installed as specified
in contract
Conduct warranty inspections
Final inspection includes punch list items

8. Contract Closeout
Following final inspection, contractor
submits notarized contractor’s release which
includes certification that:
Work was completed in accordance
with construction documents
Total amount due the contractor and a
separate stated amount for each
unsettled claim against the HA

9. Contract Closeout (cont)
 Documentation noting that HA is released
of all claims
 Wages paid to laborers or mechanics were
consistent with the wage rate requirements
and there are no outstanding claims for
unpaid wages

10. Davis Bacon Requirements
Ensure weekly payrolls are
received/reviewed
Complete HUD’s 11(employee interview)

11. Documentation
Must contain sufficient documentation to
detail complete history of contracts
Critical component of contract
administration in the event of litigation

12. Following your own
procurement policy
is a requirement,
not a choice.
12

13. Questions