American Recovery and Reinvestment Act (ARRA) COMPLIANCE TRAINING SERIES PROCUREMENT, STANDARD CONTRACT PROVISIONS, CERTIFICATIONS, WHISTLEBLOWERS Agenda 2 I. Procurement II. Standard Contract Provisions III. Certifications IV. Whistleblowers I. PROCUREMENT Definition 4 Procurement—shall mean the process whereby Government acquires goods and services at the best possible total cost from the right source. ARRA Section 1554 5 Award fixed-price contracts whenever possible. Using other than a fixed-price contract may be appropriate but requires Recipients to pay special attention to ensuring contractor oversight. Engage in competitive bidding with fair and open competition. Recipients are expected to follow the same competitive procurement requirements in selecting contractors for Recovery Act funded contracts as they do in expending other funds. Expeditious expenditure of the funds does not constitute a sufficient justification to support contract award on a non-competitive basis. Puerto Rico ARRA Implementation Guideline (PRAIG), 09-02 6 Furthermore, PR Government Entities must be guided by the following objectives, when procuring goods and services using ARRA funds public funds, bearing in mind that they are entrusted with the duty to expend these funds responsibly and in a transparent manner to further the job creation, economic recovery, and other purposes of the ARRA: • Transparency and merit-based selection criteria will guide their available discretion in committing, obligating, or expending funds under ARRA ; • Mitigate schedule, cost, and performance risk; PRAIG 09-02 7 • Define contract requirements that deliver meaningful and measurable outcomes consistent with agency plans and the goals of the ARRA; • Obtain maximum practicable competition; • Maximize opportunities for small business to compete for agency contracts and to participate as subcontractors; • Expeditiously award contracts using available streamlining flexibilities; • Apply sufficient and adequately trained workforce to responsibly plan, evaluate, award, and monitor contracts; • Ensure resources are available and perform diligent contract administration of all contracts until completion and appropriate agency oversight is provided at critical decision points; PRAIG 09-02 8 • Support projects that have, among other things and to the greatest extent: • a demonstrated or potential ability to deliver programmatic results; • optimizeeconomic activity and the number of jobs created or saved in relation to the dollars obligated; long-term public benefits by, for example, investing • achieve in technological advances in science and health to increase economic efficiency and improve quality of life; in transportation, environmental protection, and • investing other infrastructure that will provide long-term economic benefits; • fostering energy independence; or improving educational quality. PRAIG 09-02 9 Each PR Government Entity head and Federal Fund Manager should review OMB Guidance, each Award Notification and related Funding Opportunities Announcement (FOAs) and CFRs to ensure compliance with particular and specific procurement requirements of each grant. It is imperative that no Puerto Rico procurement law or regulation be bypassed or not complied with on the account of expediting the development of ARRA funded projects. When a PR Government Entity understands that such schedule compliance is not possible if it follows the same laws, principles, procedures, and practices in awarding its usual contracts, the agency must consult with AFI according to Act No. 8, which empowers AFI to direct assisted entities to follow alternative procurement processes. ARRA Procurement 10 The prospective contractor must be qualified and eligible under applicable Puerto Rico laws and regulations. PR Government Entities are reminded that they should also review any available list of contractors not qualified to do business with the Government of Puerto Rico and the Federal Government Excluded Parties List System before determining that a prospective contractor is responsible. https://www.epls.gov/ When an acquisition poses unique risks, agencies may also use special responsibility standards in the selection process to mitigate the risk. ARRA Procurement 11 PR Government Entities must identify the solicitation as one funded by the ARRA. Example: ARRA Procurement Checklist 12 II. STANDARD CONTRACT PROVISIONS Sources 14 Specific existing legal requirements typical of contracting with the Federal Government have also been included in ARRA and have been interpreted to be provisions applicable to recipients at the State level (denominated, “flow-down” provisions). ARRA Section 902 ARRA Section 1515 Specific required contract provisions Stated in memo from AFI to agencies and municipalities dated June 8, 2009. OMB clarifications regarding allowable costs must be considered. Puerto Rico ARRA Implementation Guidelines (PRAIG) 09-02 (September 1st, 2009) Required Contract Provision to Implement ARRA Section 902 15 Section 902, of the American Recovery and Reinvestment Act (ARRA) of 2009, requires that each contract awarded using ARRA funds must include a provision that provides the U.S. Comptroller General and his representatives with the authority to: (1) to examine any records of the contractor or any of its subcontractors, or any State or local agency administering such contract, that directly pertain to, and involve transactions relating to, the contract or subcontract; and (2) to interview any officer or employee of the contractor or any of its subcontractors, or of any State or local Government agency administering the contract, regarding such transactions. Accordingly, the Comptroller General and his representatives shall have the authority and rights as provided under Section 902, of the ARRA with respect to this contract, which is funded with funds made available under the ARRA. Section 902, further States that nothing in this section shall be interpreted to limit or restrict in any way any existing authority of the Comptroller General. Authority of the Inspector General- ARRA 1515 16 Section 1515(a) of the ARRA provides authority for any representatives of the Inspector General to examine any records or interview any employee or officers working on this contract. The contractor is advised that representatives of the Inspector General have the authority to examine any record and interview any employee or officer of the contractor, its subcontractors or other firms working on this contract. Section 1515(b) further provides that nothing in this section shall be interpreted to limit or restrict in any way any existing authority of an Inspector General. PRAIG 09-02 17 The requirement to share data for compliance with reporting requirements shall be included in contracts entered into by PR Government Entities with sub- grantees, contractors and subcontractors receiving ARRA funds to ensure effective implementation of ARRA accountability requirements. Document Retention 18 PR Government Entities shall require its subgrantees and contractors to, retain all records in connection with the project and activity funded with ARRA funds for three (3) years after receiving final payment under the applicable grant or contract and all other pertinent matters are closed. III. CERTIFICATIONS Certifications in General 20 Grantee must identify certifications required: • Required by Law (example Section 1511); or • Required by Grant (or Program Specific) ARRA Section 1511 21 ARRA Section 1511 22 • For funds made available to State or Local Governments for infrastructure investments, • the Governor, Mayor, or other Chief Executive, as appropriate, must certify that the infrastructure investment has received the full review and vetting required by law and that the Chief Executive accepts responsibility that the infrastructure investment is an appropriate use of taxpayer dollars. A description of the investment, estimated total cost, and the amount of ARRA funds used shall be provided and published on the ARRA Web site. Funds may not be provided to State or local agencies until this certification is made and posted on this Web site. ARRA Section 1511 23 This certification must be completed and posted before funds are received. Posted = www.buengobiernopr.gov which is linked by: www.recovery.gov Mr. Fred Gordo will be coordinating these efforts with the Web Master at Office of the Governor (Fortaleza). Example / Template Certification 1511 24 CERTIFICATION UNDER SECTION 1511 OF THE AMERICAN RECOVERY AND REINVESTMENT ACT Pursuant to Title XV, Subtitle A, Section 1511 of the American Recovery and Reinvestment Act (Pub. L. 111-5 (Feb. 17, 2009)) (“ARRA”), I, _______________*, hereby certify that the infrastructure investment funded by ARRA has received the full review and vetting required by law and that I accept responsibility that such investments are appropriate uses of taxpayer dollars. I further certify that the specific information required by Section 1511 concerning each such investment (a description of the investment, the estimated cost, and the amount of ARRA funds to be used) is described below: Description of Investment Estimated Costs ARRA Funds to be Used I understand that my State or local agency may not receive ARRA infrastructure investment funding unless this certification is made and posted. __________________________ Signature Signed this ______________, day of ______________, 2009 *In accordance with Section 1511 of ARRA, the Certifying Official may be either the Governor, Mayor, or other Chief Executive, as appropriate. Additional Comments: 1511 25 • Certifications will be posted on the web (Government Entity should keep copy for their records) • Must check with Grant Award (who is the Grantee: Governor/Mayor ) • “Infrastructure” – Not defined by the statute • Guidance indicate to define “Infrastructure” in a broader sense • Example: if funds are used to buy door knobs - this expenditure will be considered infrastructure investment IV. WHISTLEBLOWERS Federal False Claims Act 31 U.S.C. §§ 3729-3733 and ARRA, div. A, Title XV, Subtitle D § 1553 27 No PR Government Entity, nor its sub-grantees or contractors or subcontractors shall: knowingly present, or cause to be presented to the Government of the United States a false claim for payment; knowingly make, use, or cause to be made or use, a false record or Statement to get a false claim paid or approved by the Government; conspire to defraud the Government of the United States by getting a false claim allowed or paid; Federal False Claims Act 31 U.S.C. §§ 3729-3733 and ARRA, div. A, Title XV, Subtitle D § 1553 (cont.) 28 falsely certify to the United States the type or amount of property to be used; certify receipt of property on a document without completely knowing that the information is true; knowingly buy Government of the United States property from an unauthorized officer of the Government of the United States, or; knowingly make, use, or cause to be made or used a false record to avoid or decrease an obligation to pay or transmit property to the Government of the United States. Sec. 1553. Protecting State and Local Government and Contractor Whistleblowers. 29 (a) PROHIBITION OF REPRISALS.—An employee of any non-Federal employer receiving covered funds may not be discharged, demoted, or otherwise discriminated against as a reprisal for disclosing, including a disclosure made in the ordinary course of an employee’s duties, to the Board, an inspector general, the Comptroller General, a member of Congress, a State or Federal regulatory or law enforcement agency, a person with supervisory authority over the employee (or such other person working for the employer who has the authority to investigate, discover, or terminate misconduct), a court or grand jury, the head of a Federal agency, or their representatives. Sec. 1553. Protecting State and Local Government and Contractor Whistleblowers. 30 Information that the employee reasonably believes is evidence of: (1) gross mismanagement of an agency contract or grant relating to covered funds; (2) a gross waste of covered funds; (3) a substantial and specific danger to public health or safety related to the implementation or use of covered funds; (4) an abuse of authority related to the implementation or use of covered funds; or (5) a violation of law, rule, or regulation related to an agency contract (including the competition for or negotiation of a contract) or grant, awarded or issued relating to covered funds. Sec. 1553. Protecting State and Local Government and Contractor Whistleblowers. 31 (b) INVESTIGATION OF COMPLAINTS.— (1) IN GENERAL.— A person who believes that the person has been subjected to a reprisal prohibited by subsection (a) may submit a complaint regarding the reprisal to the appropriate inspector general. Except as provided under paragraph (3), unless the inspector general determines that the complaint is frivolous, does not relate to covered funds, or another Federal or State judicial or administrative proceeding has previously been invoked to resolve such complaint, the inspector general shall investigate the complaint and, upon completion of such investigation, submit a report of the findings of the investigation to the person, the person’s employer, the head of the appropriate agency, and the Board. Sec. 1553. Protecting State and Local Government and Contractor Whistleblowers. 32 (2) TIME LIMITATIONS FOR ACTIONS.— (A) IN GENERAL.—Except as provided under subparagraph (B), the inspector general shall, not later than 180 days after receiving a complaint under paragraph (1)—H. R. 1— 184 (i) make a determination that the complaint is frivolous, does not relate to covered funds, or another Federal or State judicial or administrative proceeding has previously been invoked to resolve such complaint; or (ii) submit a report under paragraph (1). Sec. 1553. Protecting State and Local Government and Contractor Whistleblowers. 33 (B) EXTENSIONS.— (i) VOLUNTARY EXTENSION AGREED TO BETWEEN INSPECTOR GENERAL AND COMPLAINANT.—If the inspector general is unable to complete an investigation under this section in time to submit a report within the 180-day period specified under subparagraph (A) and the person submitting the complaint agrees to an extension of time, the inspector general shall submit a report under paragraph (1) within such additional period of time as shall be agreed upon between the inspector general and the person submitting the complaint. Sec. 1553. Protecting State and Local Government and Contractor Whistleblowers. 34 (ii) EXTENSION GRANTED BY INSPECTOR GENERAL.— If the inspector general is unable to complete an investigation under this section in time to submit a report within the 180-day period specified under subparagraph (A), the inspector general may extend the period for not more than 180 days without agreeing with the person submitting the complaint to such extension, provided that the inspector general provides a written explanation (subject to the authority to exclude information under paragraph (4)(C)) for the decision, which shall be provided to both the person submitting the complaint and the non-Federal employer. (iii) SEMI-ANNUAL REPORT ON EXTENSIONS.—The inspector general shall include in semi-annual reports to Congress a list of those investigations for which the inspector general received an extension. In Puerto Rico 35 Any person shall promptly refer to the Task Force of the Government of Puerto Rico, with a copy to the Executive Director of AFI, any credible evidence that an officer, principal, employee, agent, Contractor, Subcontractor, or any other person has taken any action for which such person could be subject to liability under the Federal False Claims Act or has committed a criminal or civil violation of laws pertaining to fraud, conflict of interest, bribery, gratuity, or similar misconduct involving ARRA Funds. Posters: Whistle Blower Protections 36 PR Government Entities shall prepare posters to be placed in their facilities to alert employees about the Whistle Blower Protections warranted to them. PRAIG 09-02 (September 1, 2009) Appendix 2 shows the poster used by the U.S. Department of Transportation which may be used by PR Government Entities as a model. Contact 37 Antonio Fernández Compliance Coordinator Tel.: 787.378.7707 Fax: 787.641.6898 Fax: 787.641.6850 email@example.com INFRASTRUCTURE FINANCING AUTHORITY (AFI, for its acronym in Spanish) 235 CAPITAL CENTER BUILDING, NORTH TOWER ARTERIAL HOSTOS AVE. SUITE 1601 SAN JUAN, PR 00918-1433
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