(a) This subpart implements and explains the provisions of the loan documents setting forth the requirements and procedures to be followed by borrowers accepting nomination for the construction certification program. Terms used in this subpart are defined in § 1753.2.

(b) [Reserved]

(a) It is RUS policy that, as borrowers gain in experience and maturity, the advice and assistance rendered by RUS shall progressively diminish. Prior to approval of a loan, RUS may nominate certain borrowers to fulfill the responsibilities for administration and construction of projects financed with RUS loans. Borrowers who accept this nomination will be known as “certification borrowers,” and the program in which they participate will be known as the “certification program.”

(b) Generally, initial loan borrowers are not eligible for the certification program.

(c) Generally, the factors which RUS will consider in selecting borrowers for the certification program will include:

(1) The experience of the staff of the borrower.

(2) The RUS assessment of the borrower's ability to handle the certification program requirements considering the size and complexity of the proposed construction in the LD.

(3) The history of the borrower in following RUS's policies and procedures.

(4) Other factors deemed relevant by RUS.

(d) Except as specifically stated in this subpart, certification borrowers must comply with all requirements applicable to other borrowers.

(e) RUS reserves the right at any time to require submission of construction documents or to remove the borrower from the certification program.

(a) Responsibilities transferred to certification borrowers. (1) Approval of engineering and architectural service contracts.

(2) Approval of P&S.

(3) Approval of price quotations and bids, except where the low price bid is not accepted.

(4) Approval of award of construction contracts and amendments.

(5) Approval of FAP's if RUS has approved the force account method of construction for the construction project.

(6) Inspection and certification of construction.

(7) Approval of closeout documents.

(8) Other responsibilities as may be specifically granted in writing by RUS.

(b) Responsibilities retained by RUS. (1) Approval to deviate from RUS requirements, except as provided in (a) above.

(2) Approval of use of loan funds for projects other than those included in the loan construction budget. See 7 CFR part 1744 subpart C.

(3) Approval of use of loan funds in excess of amounts included in the loan budget.

(4) Approval of force account methods of engineering and construction.

(5) Approval to make significant deviations from the work plan approved by RUS.

(6) Approval of interim construction.

(7) Approval to modify or alter standard forms and contracts.

(8) Approval to open bids when fewer than the required number have been received.

(90) Approval of outside plant layouts.

(10) “Buy American” determinations.

(11) Other responsibilities not specifically transferred by this subpart or in writing by RUS.

(a) Certification borrowers shall appoint three certification officials. These appointments shall be subject to RUS approval.

(1) The “Certifying Officer” shall be an officer or employee of the borrower who is authorized to execute binding agreements. This officer shall sign all contracts, amendments, closeout documents and the certification on RUS Form 158, Certification of Contract or Force Account Proposal Approval, and RUS Form 159, Summary of Completed Construction.

(2) The “Construction Certifier” shall be an experienced telephone engineer who is either licensed in the state where the inspection will be performed, or is a borrower's staff engineer who meets the requirements of the “employee in charge” of force account engineering as described in subpart B of this part. RUS may determine that it will accept the certification only for matters within the staff engineer's area of specialization. In such cases the position of “Construction Certifier” shall be filled by more than one engineer. This official is responsible for certifying that the construction complies with all technical and code requirements.

(3) The “Certification Coordinator” shall administer the certification program and serve as the official point of contact for RUS. The certifying officer or construction certifier may also serve as the certification coordinator.

(b) Certification borrowers, shall submit and obtain RUS approval of a work plan before construction and related engineering begin.

(1) The work plan shall provide a description of the proposed construction and methods of purchasing in such detail as to enable RUS to monitor the construction program to ensure to its satisfaction that loan purposes are accomplished in an organized construction program.

(2) The work plan shall include the following:

(i) The names and qualifications of the proposed certification officials defined in § 1753.94(a).

(ii) A listing of the proposed work projects to accomplish the loan purposes showing the estimated cost, method of performing the construction, and the proposed commencement and completion dates for each work project. The proposed work projects shall be summarized on RUS Form 157, Construction Work Plan and Cost Distribution, or a form providing essentially the same information.

(iii) The proposed source of funds for meeting cost overruns if the total estimated cost of work projects exceeds the loan budget.

(iv) A statement signed by the borrower's certification officials and the GFR that the work plan is accurate and complete.

(c) Under the certification program, the borrower shall follow all standard RUS postloan engineering and construction procedures except that the approvals shown in § 1753.93(a) will be made by certification officials rather than RUS. The approvals noted in § 1753.93(a)(1), (4) and (5) will be reported immediately to RUS using RUS Form 158. Approval of closeouts, § 1753.93(a) (6) and (7), will be reported immediately on RUS Form 159.

(d) As the construction program progresses, the certification borrower shall request, by letter, RUS approval of any significant changes in work plan schedules and budgets and in certification officials.

Advance of loan funds needed to meet the certification borrower's current financial obligations are to be requested on RUS Form 481 for construction and engineering items supported by appropriate RUS Forms 158 and 159. For items other than construction or engineering, other supporting data shall be submitted. (See 7 CFR part 1744 subpart C.)

The certification borrower shall modify standard RUS forms of contract for use under the certification program by inserting an executed copy of the following certification addendum in each copy of the contract.