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HomeMy WebLinkAboutReso 97-1988 RESOLUTION NO. 97-88 CITv COUNCIL, CITY OF SOUTH SAN FRANCISCO, STATE OF CALIFORNIA A RESOLUTION AUTHORIZING EXECUTION OF CONTRACT FOR PROFESSIONAL CONSTRUCTION CONTRACT ADMINISTRATION SERVICES IN CONNECTION WITH THE AIRCRAFT NOISE INSULATION PROJECT - PHASE III, PROJECT NO. PB-87-1. BE IT RESOLVED by the City Council of the City of South San Francisco, that: The City Manager is authorized to execute on behalf of the City a Contract entitled, "Contract For Professional Construction Contract Administration Services in Connection With The Aircraft Noise Insulation Project - Phase III", Project No. PB-87-1 between the City of South San Francisco and Wilson, Ihrig and Associates. A copy of the Contract is attached as Exhibit "1". I hereby certify that the foregoing Resolution was regularly introduced and adopted by the City Council of the City of South San Francisco at a regu)a~ meeting held on the 27th day of July , 1988, by the following vote. AYES: NOES: Councilmembers Mark N. Addiego, Richard A. Haffey, Gus Nicolopulos, and Roberta Cerri Teglia None ABSTAINED: None ABSENT: Councilmember Jack Drago ATTEST: ~ ' - City Clerk EXHIBIT I TO RESOLUTION NO. 97-88 WILSON, IHRG & ASSOCIATES, Ix,lC. City of South San Francisco-Phase III CONTRACT FOR PROVIDING CONSTRUCTION CONTRACT ADMINISTRATION SERVICES IN CONNECTION WITH THE SOUTH SAN FRANCISCO AIRCRAFT NOISE INSULATION PROJECT -- PHASE III -- 24 May 1988 WILSOn, IHR~ & ASSOCIATES, INC. City of South San Francisco-Phase III CONTRACT FOR PROVIDING CONSTRUCTION CONTRACT ADMINISTRATION SERVICES IN CONNECTION WITH THE AIRCRAFT NOISE INSULATION PROJECT - PHASE III CITY OF SOUTH SAN FRANCISCO The following is an agreement between the CITY OF SOUTH SAN FRANCISCO, CALIFORNIA, hereinafter referred to as "City" and WILSON, IHRIG & ASSOCIATES, INC., a California corporation, hereinafter referred to as CONSULTANT. WHEREAS, City is performing an Aircraft Noise Insulation Project - phase III; and WHEREAS, CONSULTANT is qualified and experienced as a CONSULTANT in matters connected therewith, and has offered services for the purposes specified in this agreement; and WHEREAS, in the judgement of the City Council of said City it is necessary and advisable to employ the services of said CONSULTANT for said purpose in connection with the proposed Aircraf~ Noise Insulation Project - Phase III, hereinafter referred to as the "Project". NOW, THEREFORE, in consideration of the promises hereinafter made and exchanged, the parties hereto agree as follows: 1. Employment of Consultant: City agrees to employ Consultant and Consultant agrees to perform services for City in accordance with the provisions hereinafter contained in this Agreement. Consultant shall serve as City's professional representative in those phases of the Project to which this Agreement applies, and will give consultation and advice to City during the performance of said services. Consultant may employ the services of outside consultants and subcontractors as is deemed necessary to complete work under this Agreement, if first approved in writing by City. It is agreed that Corlett, Skaer and DeVoto Architects, Inc., is approved as a subcontractor. 2. Scope of Services: The Consultant shall provide basic and special services as described in the attached Appendix A. 3. Payment for Services: In consideration of the faithful performance of this Agreement by Consultant, City agrees to pay Consultant, on a cost plus fixed fee basis, for direct labor costs, allowable indirect costs, incidental direct expenses and appropriate profit on these costs to an amount not to exceed $26,175.00. These costs are further delineated in Appendix B. WILSON, IHRIG & ASSOCIATES, I/NC. 3 City of South San Francisco-Phase Iii Coszs in excess of the amounts estimated herein, except for costs resulting from changes in overhead rates, shall not be incurred by Consultant without prior written approval by City. 4. Progress Payments: Consultant shall submit bills to the City every month for work done in accordance with this Agreement. Bil2s shall be due and payable to the Consultant within thirty days from the date of City's receipt thereof. Bills shall be itemized to show direct costs, indirect costs, subcontract costs and pro-rated fixed fee. 5. Time of Performance: Consultant shall commence immediately upon receipt of a Notice to Proceed from City, and shall complete all work required herein in accordance with the following schedule: "The CONSULTANT shall complete the following items of work within the time specified, commencing upon issuance of the NotSce to Proceed by the City, except that CONSULTANT will not be held responsible for delay caused by acts of God or of the public enemy, acts of the City, fires, floods, epidemics, quarantine restrictions, freight embargoes, strikes not based upon unfair labor practices, or delays of Subcontractors due to such causes, provided that the CONSULTANT will notify the City Engineer in writing of the cause of the delay within ten (10) calendar days from the beginning of such delay, and the City Engineer shall ascertain the facts regarding the cause and extent of the delay and his findings thereon shall be final and conclusive:" The consultant shall provide services as requested by the City or as needed by the Project. The services are described in the attached Appendix A. 6. Project Representation: Consultant and City hereby designate Harjodh S. Gill, Ph.D. and City Engineer, City of South San Francisco, respectively, as representatives who shall be totally responsible for coordinating the efforts of their respective party with regard to the performance of the work as set forth under this Agreement. Project representation may be changed upon the mutual agreement of the City and Consultant. 7. Responsibilities of City: The City shall: a. Provide overall direction to the Consultant. V,,rlLSON, IHRG & ASSOCIATES. INC. City of South San Francisco-Phase III Assist Consultant by placing at his disposal available information pertinent to the project including previous reports and other data relative to the project; all of which Consultant may utilize upon in performing the services agreed upon. The City shall assist in scheduling times mutually agreeable to the CONSULTANT and participating property owners for the purpose of conducting field visits at locations selected by the CONSULTANT. The City will cooperate with the CONSULTANT in securing timely access to the properties. Review progress schedules and make determination regarding their acceptability. e. Review and approve Consultant's payment requisitions. Perform Grant Administration Services for obtaining and complying with all conditions of approval contained in any grants, rules, regulations or guidelines pertaining to the Project. 8. Additional Work: For any work directed by the City which is not delineated in Appendix A, the Scope of Work will have changed and the fixed fee will be subject to renegotiation. A supplemental agreement or amendment to this Agreement shall then be entered into delineating the additional work, associated provisions, and compensation for same. The supplemental agreement or amendment to this Agreement shall be preferably executed prior to Consultant performing said additional work; however, should this not be possible in the interest of time, City shall give Consultant written authorization for performance of services while the necessary documents are prepared. 9. Termination of Agreement: This Agreement may be terminated by the City upon ten (10) days written notice. If this Agreement is terminated for any reason during any phase, Consultant shall be paid for the reasonable value of services performed by him up to the time of such termination. Said reasonable value to be determined in the following manner: Value of direct labor will be the Consultant's payroll cost for service rendered to the date of termination. Indirect labor will be based on the appropriate contract rates and overhead factor. Value of subcontracts will be the cost for subcontract work incurred by Consultant to the date of termination. WILSON, IHRIG & ASSOCIATES, INC. City of South San Francisco-Phase III Value of profit will be a percentage of the contract fee for profit based on the percent expenditure of Consultant's total estimated direct labor at the time of termination. See paragraph 19 of this agreement for an explanation of termination by default. Except as indicated above, Consultant services for the work shall terminate 90 days after final acceptance of the Project or by mutual agreement of the City and Consultant. This contract may be extended beyond that date by mutual agreement of the City and Consultant~ 10. Non-Assignability: Consultant shall not assign or transfer this contract or any interest or obligation therein without the prior written consent of City, and then only upon such terms and conditions as City may set forth in writing. 11. Waiver: In the event that either City or Consultant shall at any time or times waive any breach of this Agreement by the other, such waiver shall not constitute a waiver of a~y other or succeeding breach of this Agreement, whether of the same or any other covenant, condition or obligation. 12. Insurance: The CONSULTANT shall take out and maintain during the life of this Agreement the following policies of insurance: ae Worker's Compensation and employers' liability insurance in the statutory amount, as applicable. Commercial General Liability Insurance: In an amount not less than FIVE HUNDRED THOUSAND DOLLARS ($500,000.00) for injuries including, but not limited to death to any one person or damage to property and subject to the same limit for each person, in an amount not less than ONE MILLION DOLLARS ($1,000,000.00) on account of any one occurrence and in aggregate. Non-owned automobile insurance in an amount not less than FIVE HUNDRED THOUSAND DOLLARS ($500,000.00) to be maintained during the life of this Agreement. It is agreed that the insurance required by Subsection b shall be extended to include the City of South San Francisco, its elective and appointive boards, officers, agents and employees, with respect to operations performed by the Consultant, as described herein. Evidence of this insurance described above shall be provided to City Attorney as to form, amount WILSO.X,, IHI;~I(: & ASSOCIATES, INC. City of South San Francisco-Phase III and carrier. The policy of insurance shall also contain a provision indicating that such insurance shall not be reduced or cancelled except upon thirty (30) days written notice to City. 13. ResDonsibility of the Parties: Se Consultant shall indemnify, hold harmless and, at City's request defend City, its employees, agents, officers, Boards and Commissions, whether elected or appointed, from and against all claims, demands, damages, liabilities, costs, expenses, including reasonable attorneys fees or obligations, for or in connection with any personal injury (including death) and/or property damage resulting from the negligent acts, errors or ommissions of the Consultant, including Consultant's contractors, subcontractors, employees, agents or representatives in connection with Consultant's performance under this Agreement. be City shall indemnify, hold harmless and, at Consultant's request defend Consultant, its employees, agents and officers from and against all claims, demands, damages, liabilities, costs, expenses, including reasonable attorneys fees or obligations, for or in connection with any personal injury (including death) and/or property damage resulting from the negligent acts, errors or omissions of City, its employees, officers or agents in connection with City's obligations under this agreement. In the event of concurrent negligence of City, its officers, agents and/or employees and Consultant, its officers, agents, employees, contractors or subcontractors, then the liability for any and all claims for personal injury (including death) and property damage, and the cost of defending same, including attorneys fees, arising out of performance of this agreement shall be apportioned under the California theory of comparative negligence as established presently, or as may hereafter be modified. 14. Notices: Ail notices hereinafter shall be in writing and shall be sent by certified or registered mail, postage prepaid, addressed as follows: TO CITY: CITY ENGINEER City of South San Francisco 400 Grand Avenue South San Francisco, California 94080 TO CONSULTANT: Harjodh S. Gill, Ph.D. WILSON, IHRIG & ASSOCIATES, INC. 5776 Broadway Oakland, California 94618 WILSOn, IHR G & ASSOCIAI£S, ~C. 7 City of South San Francisco-Phase III 15. Responsibilities of Consultant: Consultant shall have no authority, express or implied, to act on behalf of City in any capacity whatsoever as an agent. Consultant shall have no authority, express or implied, pursuant to this Agreement to bind City to any obligation whatsoever. be At all times during the term of this Agreement, Consultant shall be an independent contractor and shall not be an employee of City. Ail products of Consultant shall become the property of the City and shall be delivered to the City not later than thirty (30) days after the termination date of this Agreement unless an earlier time is specified for a particular product. The Consultant shall provide necessary coordination between his Sub¢onsultants and Government Agencies. 16. Non-Discr. imination: No discrimination shall be made by Consultant in the employment of persons to work under this contract because of race, color, national origin, ancestry, sex, or religSon of such person. 17. Workers' Compensation: Consultant, by executing this contract, certifies that Consultant is aware of the provisions of Sections 3700 et seq. of the Labor Code of the State of California requiring every employer to be insured against liability for workers' compensation or to undertake self-insurance in accordance with the provisions of that Code, and certifies that Consultant will comply with such provisions before commencing the performance of the work of this contract. A certificate of insurance for said policy shall be deposited with the City when the Consultant executes this Agreement. In case any work is sublet, Consultant shall require subcontractor similarly to provide worker's compensation insurance for all of the latter's employees, unless such employees are covered by the protection afforded by Consultant. Consultant indemnifies City for any damages resulting to City from failure of either Consultant or any subcontractor to take out or maintain such insurance. 18. Costs and Attorney's Fees: The prevailing party in any action b[ought to enforce or construe the terms of this Agreement may recover from the other party its reasonable costs and attorney's fees expended in connection with such an action. %¥1L50,%', I~RK3 &ASSOCIAT£S, I~C. 8 City of South San Francisco-Phase III 19. FAA Mandatory Contract Provisions: a. Violation or Breach of Contract by Consultant A violation or Breach of Contract by Consultant shall be grounds for the City to terminate the Contract for reason of default of the contract (see b. below). b. Termination by Default If the termination is due to the failure of the Consultant to fulfill his contract obligations, the City may take over the work and prosecute the same to completion by contract or otherwise. If, after notice of termination for failure to fulfill contract obligations, it is determined that the Consultant had not so failed, the termination shall be deemed to have been effected for the convenience of the City. In such event, adjustment in the contract price shall be made as provided in paragraph a. of this clause. The rights and remedies of the City provided in this clause are in addition to any other rights and remedies provided by law or under this contract. The City, the Federal Aviation Administration, the Comptroller General of the United States, or any of their duly authorized representatives shall have access to any books, documents, papers, and records of Consultant which are directly pertinent to the project, for the purpose of making audits, examinations, excerpts, and transcriptions. Consultant is to maintain all required records for three years after the City makes final payment and all other pending matters are closed. d. Title VI and Minority Business Enterprise Assurances are hereby included in the contract. (See Appendix D.) 20. Agreement Contains All Understanding: This document, together with the attached Appendices A through D, represents the entire and integrated Agreement between City and Consultant and supercedes all prior negotiations, representations, or agreements, either written or oral. This document may be amended only by written [nstrument, signed by both City and Consultant. All provisions of this Agreement are expressly made conditions. This Agreemen shall be governed by the laws of the State of California. ~,¥1~ON. IHRIG&ASSOCIATES, t',~. 9 City of South San Francisco-Phase III IN WITNESS WHEREOF, the City of South San Francisco, State of California as authorized by the City Council at its meeting held on has caused its corporate name to be affixed hereto and the Consultant has hereto set their hands and corporate name the day of , 19 , at South San Francisco, California. CITY OF SOUTH SAN FRANCISCO, CALIFORNIA By [{arj~h S. Gill, Ph.D.. Principal Approved as to Form: City Attest: City Clerk Wll3ON, ~IG&ASSOCI^T~S, INC. A-1 City of South San Francisco-Phase III APPENDIX A SCOPE OF SERVICES - PHASE III WILSON, IHI~IG&ASSOCIAT[S, INC. A-2 City of South San Francisco-Phase III Our pro] Adminis of Sout'~ Constru. contrac Please propose excludec )osed Scope-of-~ork relating to the Construction Contract ~ration Services is based on the assumption that the City San Francisco will directly employ a full-time tion Manager to directly liaison with the homeowners, :or and the City. lore that our work only covers the services outlined in the Scope-of-Work. The services listed below are clearly from our Scope-of-Work. dditional work resulting from changes in the design criteria or design, requested and authorized by you after ~.r'ior approval of these items. ~.dditional professional services made necessary by the default of the Contractor or by major defects in the work of the Contractor in the performance of the Construction C)ntract. F ~conciliation of any underlying permit or code issue that Fay exist or arise as a result of previous design decisions and constru.ction practices npt a part of this cont.~act. Additional work necessitated by owner initiated change orders during construction. Additional work made necessary by the extension of the a reed upon project completion date, and the construction w. expected to take no more than ten months. 6. P eparation of as-built drawings. 7. C .ordination with special consultants not specified in Slope of Services· PROPOSED[SCOPE-OF-WORK FOR CONSTRUCTION CONTRACT ADMINISTRATION SERVICES 1. Intr¢ Work Serv: Proj Corl ~duction relating to the Construction Contract Administration .ces for the South San Francisco Aircraft Noise Insulation ~ct - Phase III is presented below, performed primarily by tt, Skaer and DeVoto, Inc. (CSDA). Wilson, Ihrig & Asso¢~iates, Inc. (WIA) is only expected to perform site ins ctions at ten residences selected for detailed study. WII_~ON, 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 A-3 City of South San Francisco-Phase III Task 1 - Preconstruction Conference CSDA to schedule and administer a preconstruction conference to discuss construction procedures. Conference to include owner, contractor, construction inspector, architect, acoustical consultant and major subcontractors. Task 2 - Field Questions from Inspector CSDA to receive and process questions from Construction Inspector regarding field conditions and clarifications as presented to him by contractor. CSDA to answer inspector's questions regarding contractors compliance with plans and specs. Task 3 - Clarifications CSDA to prepare and issue clarification information as required. Task 4 - Field Visits CSDA to make field visits as required to ascertain if contractors work is in general conformance with plans and specs. Task 5 - Final Review and Punchlist CSDA to make final site inspection to clarify any unresolved inspector questions or observations. Architect to approve contractors final request for payment. Task 6 - Change Orders CSDA to review and process all contractor requests for change orders in accordance with terms and conditions of construction agreement. Task 7 - Review of Shop Drawings and Submittals CSDA to review shop drawings and submittals. Task 8 - Construction Observation WIA to inspect each of the ten residences selected for detailed study to ensure that the acoustical aspects of the project have been implemented correctly. WILSON, IHRI~ & AS.SOCIAl'ES. I,'xlC B-1 City of South San Francisco-Phase III APPENDIX B BREAKDOWN OF COST AND HOURS BY TASKS WILSO,%,IHI(~&A,SSOCIATES, INC. B-2 City of South San Francisco-Phase III Labor p pr-esent~ for ser, The cost Table I The fee of WIA diffe ~ojections for each of the tasks by labor category are ~d on Table I for services provided by WIA and in Table II ,ices provided by CSDA. estimates for each of the tasks are summarized in I. estimates are based on the hourly rates for each category ~nd CSDA personnel, based on the current salaries for .t labor categories. Cost esiimates for professional services and direct expenses for the truction contract Administration Services are as follows: Wi son, Ihrig & Associates, Inc. Co lett, Skaer & DeVoto Architects, Inc. $ 3,975.00 $ 22,400.00 TOTAL: $ 26,175.00 TABLE I L~BOR ESTIMATES (HOURS) FOR WILSON, IHRIG & ASSOCIATES, INC. FOR PHASE III: CONSTRUCTION CONTRACT ADMINISTRATION SERVICES Task Estimated Man-Hours for Each Labor Category Project Principal Manager 1. Preconstruction Conference to Discuss Procedures 2. Field Questions from Inspector 3. Clarifications 4. Field Visits (15 visits @ 3 hfs ea; every 2 weeks) 5. Final Review and Punchlist 6. Change Orders 7. Review Shop Drawings and Submittals 8. Construction Observation 26 27 53 TOTAL HOURS BY LABOR CATEGORY: 26 27 53 Total Hours Per Task TABLE II LABOR ESTIMATES (HOURS) FOR CORLETT, SKAER AND DEVOTO ARCHITECTS, INC. FOR PHASE III: CONSTRUCTION CONTRACT ADMINISTRATION SERVICES Task 1. Preconstruction Conference to Discuss Procedures 2. Field Questions from Inspector 3. Clarifications 4. Field Visits (20 visits @ 3 hfs ea; every 2 weeks) 5. Final Review and Punchlist 6. Change Orders 7. Review Shop Drawings and Submittals 8. Construction Observation TOTAL ~OURS BY LABOR CATEGORY: Estimated Man-Hours for Each Labor Category Project Principal Architect/ Draftsman Clerical Manager 8.5 8.5 -- 12 70 -- 5.5 17 45 14 70 -- 5.5 11 Total Hour s Per Task 17 82 73 95 8.5 22.5 -- 5.5 36.5 14 17 28 5.5 64.5 12 17 22.5 -- 53.5 74.5 222 95.5 27.5 419.5 TABLE III SU[~4ARY OF COST ESTIMATES Task 1. Preconstruction Conference to Discuss Procedures 2. Field Questions from Inspector 3. Clarifications 4. Field Visits (20 visits @ 3 hfs ea; every 2 weeks) 5. Final Review and Punchlist 6. Change Orders 7. Review Shop Drawings and Submittals 8. Construction Observation Subtotal Fees: Direct Expenses: Printing, Telephone, and Travel, etc. (including 12% profit) TOTAL ESTIMATED COST: Estimdted-F~~rVfces Provided by: Wilson, Ihrig & Corlett, Skaer and Associates, Inc. DeVoto Architects,Inc. 1, 275.00 4,700.00 3,151.00 5,252.00 3,915.00 $ 3,915.00 2,151.00 2,856.00 2,725.00 $ 22,100.00 $ 60.00 ~ $ 3,975.00 $ 300.00 $ 22,400.00 ~<~ o o o \¥1LSON, IHR~ & A55OCIATES, INC. C-1 City of South San Francisco-Phase III APPENDIX C STATEMENT OF CLARIFICATION OF OVERHEAD RATES WILSO'~,IHRIG&ASSOCIAI'ES. INC. C-2 City of South San Francisco-Phase III APPENDIX C STATEMENT OF CLARIFICATION OVERHEAD RATES a m The allowable indirect costs under this contract shall be obtained by applying overhead rates to direct labor costs or to other bases agreed upon by the City and the Consultant, as specified below. b. The Consultant, as soon as possible, but not later than six months after the expiration of his fiscal year, shall submit to the City a proposed final overhead rate or rates for that period based on the Consulting Engineer's actual data. Determination of overhead rates for each period by the Consultant and the City shall be undertaken as promptly as practicable after receipt of the Consultant's proposal. Final determination of these overhead rates shall be based upon final audit. c. Allowability of costs shall be determined in accordance with the provisions of 41 CFR 1-15.2 and 1-15.4. The results of each determination shall be set forth in a modification to this contract, which shall specify: (1) the agreed final rates; (2) the bases to which the rates apply; and (3) the periods for which the rates apply. Pending establishment of final overhead rates for any period, the Consultant shall be reimbursed at negotiated provisional rates as provided in the contract, subject to appropriate adjustment when the final rates for that period are established. To prevent substantial over- or underpayment, and to apply either retroactively or prospectively, provisional rates may, at the request of either party, be revised by mutual agreement. Any such revision of negotiated ~rovisional rates provided in the contract shall be set forth in a modification of this contract. Principals time is charged only when directly applied to the project and then charges are based on actual salary plus the same multipliers as other employees. \VlLSO%,IHRI(J&A. SSOCIATI:'$,IINC. D-1 City of South San Francisco-Phase III APPENDIX D FEDERAL ASSURANCES VVlLSON', IHRIG & ASSOCIATES, INC. D-2 City of South San Francisco-Phase III APPENDIX D CONTRACTOR CONTRACTUAL REQUIREMENTS TITLE VI ASSURANCES During the performance of this contract, the contractor, for itself, its assignees and successors in interest (hereinafter referred to as the "contractor") agrees as follows: 1. CompLiance with Regulations. The contractor shall comply with the regulations relative to nondiscrimination in Federally assisted programs of the Department of Transportation (hereinafter, "DOT") Title 49, Code of Federal Regulations, Part 21, as they may be amended from time to time, (hereinafter referred to as the Regulations), which are herein incorporated by reference and made a part of this contract. 2. NondSscrimination. The contractor, with regard to the work performed by it during the contract, shall not discriminate on the grounds of race, color, or national, origin in the selection and retention of subcontractors, including procurements of materials and leases of equipment. The contractor shall not participate either directly or indirectly in the discrimination prohibited by Section 21.5 of the Regulations, including employment practices when the contract covers a program set forth in Appendix B of the Regulations. 3. Solicitations for Subcontracts, Including Procurements of Materials and Equipment. In all solicitations, either by competitSve bidding or negotiation made by the contractor for work to be performed under a subcontract, including procurements of materials or leases of equipment, each potential subcontractor or supplier shall be notified by the contractor of the contractor's obligations under this contract and the Regulations relative to nondiscrLmination on the grounds of race, color, or national origin. 4. Information and Reports. The contractor shall provide all informatSon and reports required by the Regulations or directives issued pursuant thereof and shall permit access to its books, records, accounts, other sources of information, and its facilities as may be determined by the sponsor or the Federal Aviation Administration (FAA) to be pertinent to ascertain compliance with such Regulations, orders, and instructions. Where any information required of a contractor is in the exclusive possession of another who fails or refuses to furnish this information, the contractor shall so certify to the sponsor or the FAA, as appropriate, and shall set forth what efforts it has made to obtain the information. \%'I~ON, IHR~ & ~5OC1~£5,~C. D-3 City of South San Francisco-Phase III , 5. Sanctions for Noncompliance. In the event of the contractor's noncompl:.ance with the nondiscrimination provisions of this co'ntract~ the sponsor shall impose such contract sanctions as it or the F~A may determine to be appropriate, including, but not limited .o: a. ,ithholding of payments to the contractor under the contract until the contractor complies; and/or b. cancellation, termination, or suspension of the contract, in whole or in part. 6. Incorporation of Provisions. The contractor shall include the provisiors of paragraphs 1 through 5 in every subcontract, includinc procurements of materials and leases of equipment, unless exempt by the Regulations or directives issued pursuant thereto. The contractor shall take such action with respect to any subcontract or procurement as the sponsor or the FAA may direct as a means of enforcing such provisions including sanctions for nonccmpliance. Provided, however, that in the event a contractc~ becomes involved in, or is threatened with, litigation with a subcontractor or supplier as a result of such direction, the contractor may request the sponsor to enter into such litigation to protect the interests of the sponsor and, in addition, the contractor may request the United States to enter into such litigation to protect the interests of the United States. MINORITY BUSINESS ENTERPRISE (MBE) ASSURANCES 1. Polic,. It is the policy of the Department of Transportation (DOT) tha: minority business enterprises as defined in 49 CFR Part 23 s]~all have the maximum opportunity to participate in the performanCe of contracts financed in whole or in part with Federal funds under this agreement. Consequently, the MBE requirements of 49 CFR Pa~t 23 apply to this agreement. 2. MBE Obligation. The contractor agrees to ensure that minority business enterprises as defined in 49 CFR Part 23 have the maximum opportunity to participate in the performance of contracts and subcontracts financed in whole or in part with Federal funds provided Under this agreement. In this regard, all contractors shall tak~ all necessary and reasonable steps in accordance with 49 CFR Part 23 to ensure that minority business enterprises have the maximum opportunity to compete for and perform contracts. Contractors shall not discriminate on the basis of race, color, national ~rigin, or sex in the award and performance of DOT-ass contracts.