Mem 4: Contract and Grant Procedures

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Mem 4: Contract and Grant Procedures  (2003) 
L. Paul Bremer, Coalition Provisional Authority
Deficient OCR, possibly incomplete. Original PDF available at Commons:Category:Coalition Provisional Authority documents.

COALITION PROVISIONAL AUTHORITY MEMORANDUM NUMBER 4

CONTRACT AND GRANT PROCUDURES
APPLICABLE TO VESTERD AND SEIZED IRAQI PROPERTY AND THE
DEVELOPMENT FUND FOR IRAQ

IMPLEMENTATION OF REGULATION NUMBER 3, PROGRAM REVIEW
BOARD

Pursuant to my authority as Administrator of the Coalition Authority (CPA) and the laws
and usages of war, and consistent with relevant U.N. Security Council resolutions, including
Resolution 1483 (2003),

Underscoring that the Development Fund for Iraq (DFI) shall be used in a transparent
manner to meet the humanitarian needs of the Iraqi people, for the economic reconstruction
and repair of Iraq’s infrastructure, for the continued disarmament of Iraq, and for the costs
of Iraqi civilian administration, and for other purposes benefiting the people of Iraq, and that
the Program Review Board as authorized by CPA Regulation Number 3 (18 June 2003) is
responsible for recommending expenditures of resources from the DFI.

Noting that Resolution 1483 (2003) states that independent public accountants approved by
and reporting to the International Advisory and Monetary Board (IAMB) shall audit the DFI
to ensure that the DFI is used exclusively for the purposes stated in Resolution 1483 (2003),

Reaffirming that the CPA is committed to ensuring that all state- or regime-owned cash,
funds or realizable securities that have been seized by Coalition Forces in Iraq consistent
with the laws and usages of war, shall be used only to assist the Iraqi people and support the
reconstruction of Iraq,

Implementing CPA Regulation Number 3, Program Review Board (CPA/REG/18 June
2003/03),

I hereby promulgate the following:

Section 1
Purpose

This memorandum establishes procedures applicable to the execution of contracts and
grants for the benefit of the Iraqi people using Iraqi Funds, as defined herein. As steward

for the Iraqi people, the CPA will manage and spend Iraqi Funds, which belong to the Iraqi
people, for their benefit. Although Iraqi Funds are not subject to the same laws and
regulations that apply to funds provided to the COA directly from coalitions governments,

CPA/MEM/19 August 2003/04


they shall be managed in a transparent manner that fully comports with the CPA’s
obligations under international law, including Resolution 1483.

Section 2
Applicability

This Memorandum applies to contracts and grants executed by or on behalf of the CPA,
when those instruments obligate and expend Iraqi Funds. It covers contracts and grants
executed by:

1) CPA Regional Directors carrying out the Regional Directors’ Emergency Response

Program;
2) CPA Regional Directors carrying out the Construction Initiative for Iraq Program;
3) Interim Ministry Officials, working in conjunction with Senior Ministry Advisors,

when carrying out requirements that are not funded through the national Ministry

budget process;
4) CPA’s Head of Contracting Activity, or designee(s), and
5) Others delegated such authority by the Administrator.

This Memorandum does not apply to:

1) Iraqi Ministries and governmental agencies executing contracts or grants to fulfill
requirements approved through the national budget process if the Administrator, or
his designee, determines that the contracting procedure of the Ministry or agency is
adequate to ensure the transparent use and management of Iraqi funds. However, if
the contracting procedures of the particular Ministry or agency are not determined to
be adequate, this Memorandum shall apply, and

2) Coalition Forces commanders carrying out the Commanders’ Emergency Response
Program. The Commanders’ Emergency Response Program will use the procedures
contained in FRAGO 89 (Appendix E) or any subsequent amended guidance to
FRAGO 89.

Section 3
Definitions

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1) “Competitive Range”: A group of proposals that are eligible for award of a
particular contract or grant, as determined by a Contracting Officer on the basis of
cost and other factors stated in the solicitation.

2) “Contract”: A written agreement whereby the CPA or Coalition Forces acquire
goods, services or construction from a person or entity under prescribed terms and
conditions, for the purpose of assisting the Iraqi people or assisting in the recovery
of Iraq.

3) “Contract Award Committee”: As used in this Memorandum, a group of three or
more officials selected by the Contracting Officer appointing authority responsible
for reviewing preliminary award decisions of Large Purchases for compliance with
this Memorandum and sound business judgment. The Contract Award Committee
need not convene as a group; however, except as provided in Section 7 below, a
majority of the members must concur in the award decision prior to award.

4) “Contracting Officer”: As used in this Memorandum, an individual who has been
authorized by the Administrator, CPA, in accordance with Section 4 below, to enter
into Contracts or Grants using Iraqi Funds.

5) “Grant”: A written instrument that transfers Iraqi Funds from the CPA or Coalition
Forces to a recipient grantee, in order to carry out a program or project that directly
benefits the Iraqi people or assists in the recovery of Iraq.

6) “Invitation for Bids”: An invitation to prospective contractors to submit proposals to
meet CPA requirements. An invitation for bids describes a requirement for a
prospective contract by explaining the nature of the opportunity, including the goods
or services to be provided, required performance, the time for performance,
requirements to demonstrate the responsibility of the potential source, unique
requirements, the closing date for bids, and other information necessary for a
potential source to submit a bid. With an IFB, the award is determined solely on the
basis of price or price-related factors.

7) “Iraqi-based”: A company (including a subsidiary company) whose principal place
of business is located within Iraq.

8) “Iraqi Funds”: Funds under the control of the Authority consisting of (a) proceeds
from Iraqi state-owned property that has been vested or seized in accordance with
applicable law and made available to the CPA to assist the Iraqi people and assist in
the reconstruction of Iraq; and (b) funds in the Development Fund for Iraq, the
establishment of which is noted in Resolution 1483 (2003). As used in this
Memorandum, “Iraqi Funds” do not include funds provided through the
appropriations process of Coalition member governments (for example, funds

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provided directly to the CPA by the governments of the United States or the United

Kingdom).

9) “Large Purchase”: A contract with a value of greater than US$500,000.

10)“Micro Purchase”: A contract with a value of US$5,000 or less.

11)“Request for Proposal”: An invitation to prospective contractors or grant recipients
to submit proposals to meet CPA requirements. A request for proposal usually
includes a description of a requirement for a prospective Contract or Grant that
explains the nature of the opportunity including the goods or services to be provided,
required performance, the time for performance, the evaluation criteria for Contract
award, requirements to demonstrate the responsibility of the potential source, unique
requirements to demonstrate the responsibility of the potential source, unique
requirements, the closing date for proposals, and other information necessary for a
potential source to submit a proposal.

12)“Small Purchase”: A contract with a value greater than US$5,000 and less than or
equal to US$500,000.

13)“Solicitation”: A request to submit offers or quotations to fulfill a requirement for
goods or services that can be met through a Contract. “Request for Proposal” and
“Invitation for Bids” are types of solicitation.

Section 4
Appointment of Contracting Offices

1) General. For the purpose of carrying out programs to assist the Iraqi people and
assist in the recovery of Iraq using Iraqi Funds, the officials identified in paragraph 2
may appoint Contracting Officers who may enter in to Contracts or Grants on behalf
of the CPA. Unless otherwise terminated by the Administrator, this delegation shall
remain in effect until the establishment of an internationally recognized,
representative government by the people of Iraq.

2) The following officials are authorized to appoint Contracting Officers within their
directorates, commands or organizations, in writing and in a form prescribed by the
Head of Contracting Activity, CPA, in consultation with the CPA General Counsel:

a) Head of Contracting Activity, CPA, or the Principal Assistant Responsible for
Contracting, CPA;

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b) CPA Directors of Oil Policy; Civil Affairs; Economic Development; AID;
Operations and Infrastructure; Interior Affairs; Private Sector Development;
and Security Affairs.

c) Senior Iraqi Ministry Advisors, in coordination with the interim Iraqi
Ministers, for contracting officers within the ministry concerned, and

d) Other persons specifically authorized by the Administrator.

3) In exercising their authority to appoint Contracting Officers, the officials listed in
paragraph 2 above shall consider the training and experience of prospective
appointees and shall, to the extent practicable, confer Contracting Officer authority
on those officers already holding Coalition government contracting warrants and/or
experience as contingency contracting officers or field ordering officers. The Head
of Contracting Activity, COA, with the approval of the Administrator, may prescribe
additional requirements (such as completion of prescribed training requirements)
that persons must hold prior to receiving Contracting Officer appointments.

4) Contracting Officers responsible for carrying out programs must actively coordinate
proposed funding initiatives with all other Contracting and Grant-making officials in
their geographic areas, in order to ensure against duplication of effort.

Section 5
Technical Supervision of Contracting Officers

The Head of Contracting Activity, CPA, shall be responsible for providing technical
supervision over Contracting Officers appointed pursuant to Section 4, above. This
technical supervision may include prescribing training requirements and prescribing
appropriate forms for use in solicitations, contract awards, and grant awards. For
contracting officers assigned to the CPA Contracting Activity, the Head of Contracting
Activity, CPA, shall provide administrative oversight as well as technical supervision.

Section 6
Principles Applicable to Instruments

1) Identification of Parties. Contracts and Grants must prominently contain the
following language to identify the parties;:

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“This contract/grant is entered into under the authority of the Administrator as
head of the Coalition Provisional Authority (CPA), which is temporarily
exercising governmental authority in Iraq pursuant to the law and usages of
war and relevant United Nations Security Council Resolutions, including
Resolution 1483 (2003)(“Coalition”) and by ______________________
(“Contractor”).

2) Competition.

a) Contracts. Unless otherwise exempted under this Memorandum, competition
is mandatory for all Contracts. Reasonable efforts will be made to obtain
competitive offers by publicizing a solicitation through bulletin boards, the
CPA World Wide Web page, the UNDB, vendor databases developed by the
Head of Contracting Activity, and other means. If circumstances required
award of a contract without competition, a written justification describing the
exigencies requiring contracting without competition will be documented in
the Contract file. Contracts will be awarded to the offer providing the greatest
value to the CPA or Coalition Forces, based on price and all other evaluation
factors contained in the solicitation.

b) Grants. Reasonable efforts will be made to identify all organizations capable
of performing the Grant. Grants in excess of $500,000 will be tendered for
proposals by capable organizations, except as authorized for good cause, in
writing, by the official that appointed the Contracting Officer involved.

3) Preference for Iraqi Vendors. Iraqi-based vendors who are capable of performing a
Contract or Grant in a responsible and responsive manner will be afforded the
following preferences when competing with foreign firms. If the Contracting
Officer determines that at least two Iraqi-based vendors are available, the
Contracting Officer may limit the competition to Iraqi-based vendors only. It the
Contracting Officer determines that limiting competition to Iraqi-based vendors is
not appropriate, the Contracting Officer may use the amount of Iraqi participation in
the contract (as a subcontractor or otherwise) as an evaluation criterion for purposes
of determining who is entitled to the award of the contract.

4) Fair and Reasonable Price. The Contracting Officer must determine that the price of
a contract is fair and reasonable. Prices for goods and services will not exceed their
fair market value--as determined by the Contracting Officer--after considering the
time for delivery or urgency of the service, and other relevant factors.

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5) Conflicts of Interests. Contracts or Grants administered under this Memorandum
will not directly or indirectly benefit any Ministry, CPA or Coalition Forces official
or employee involved in the contracting or grant-making process, or the family
members of such officials or employees. Persons involved in the contracting
process, from the development of the requirement through the completion of
performance, shall not:

a) Hold financial interests that conflict with the conscientious performance of
duty.

b) Engage in financial transactions using nonpublic Government information or
allow the improper use of such information to further any private interest.

c) Solicit or accept any gift or other item of monetary value from any person or
entity seeking official action from, doing business with, or conducting
activities regulated by the CPA, or whose interests may be substantially
affected by the performance or nonperformance of the employee’s duties.

d) Knowingly make unauthorized commitments or promises of any kind
purporting to bind the CPA.

e) Use public office for private gain.

An official or employee of the CPA or Coalition Forces involved in the contracting
process shall:

a) Act impartially and not give preferential treatment to any private organization
or individual.

b) Disclose waste, fraud, abuse, and corruption to appropriate authorities.

c) Endeavor to avoid any actions creating the appearance that they are violating
the law or ethical standards.

6) Combining and Dividing Awards. To the extent practicable, requirements for a
project or related projects may be consolidated into one contract, in order to reduce
the administrative burden of contracting. Requirements may not be split to avoid the
application of these rules.

7) Responsibility. Contracting officers must determine that a contractor who receives a
contract award must be responsible. This means that the contractor must:

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a) Have adequate financial resources to perform the contract, or the
ability to obtain them;

b) Be able to comply with the required or proposed delivery or
performance schedule, taking into consideration all existing
commercial and governmental business commitments;

c) Have a satisfactory performance record, if the contractor has
performed contracts in the past;

d) Have a satisfactory record of integrity and business ethics;

e) Have the necessary organization, experience, accounting and
operational controls, and technical skills, or the ability to obtain them;

f) Have the necessary production, construction, and technical equipment
and facilities, or the ability to obtain them; and

g) Be otherwise qualified and eligible to receive an award under
applicable laws and regulations.

Section 7
Contracts

1) Micro-Purchases. Micro-Purchase Contracts may be awarded without competition if
the Contracting Officer determines that the offered price and terms are fair and
reasonable. However, Contracting Officers are encouraged to obtain competition
when possible. Oral solicitations may be used. Micro-Purchases will be
documented in summary files demonstrating competition (if any), basis for award (if
other than lowest price), and material terms. The documentation will be tailored to
the size and nature of the acquisition.

2) Small Purchases. Contracting Officers, when possible, will obtain at least three
competitive offers for Small Purchases. For Small Purchases from $5,000.01 to
$25,000, oral solicitations may be used; however, Contracting Officers must
maintain documentation of sources solicited. For Small Purchases greater than
$25,000, written solicitations will be used. Sufficient information will be included
in the contract file to enable a review of the transaction, including evidence of
competition or the basis for contracting without competition, price quotations, and
the basis for the contract award if price is not the determining factor. Written
justifications detailing the unique qualifications of the contractor or other exigent
circumstances requiring an award without competition will be prepared for Small
Purchases. Requirements for justifications are contained in Appendix A.

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a) Blanket Purchase Agreements. Contracting Officers are encouraged to use
blanket purchase agreements for repetitive requirements to reduce
administrative burdens and to obtain favorable pricing.

b) All Small Purchase contracts will contain payment terms including an agree
upon payment schedule (preferably with milestones tied to performance) for
service contracts, and performance requirements clearly defining the
responsibilities and time for performance. Additionally, the Contracting
Officer will use appropriate contract provisions listed in Appendix B to this
Memorandum for the particular solicitation or contract involved.

c) Requirements in excess of $10,000 should be posted at a public location and
disseminated in a manner that will foster competition, including advertising in
local media when appropriate, through bulletin boards, the CPA World Wide
Web page, vendor databases developed by the Head of Contracting Activity,
and other means.

3) Large Purchases.

a) Large Purchase Contracts will be competed, except as authorized below. All
Large Purchase contract opportunities will be posted and advertised to the
maximum extent practicable, with a goal of obtaining at least three competitive
offers.

b) The Head of Contracting Activity, CPA, will ensure that experienced
contracting officials are assigned to execute contracts underneath the HCA and
provide technical assistance to all other appointed Contracting Officers or Iraqi
Ministry Contracting Activities with respect to all Large Purchase solicitations.

c) Acquisitions generally will be made through negotiation. The contracting
agency will develop a Request for Proposal (RFP) for submission to
prospective contractors. The RFP will set forth the essential information
necessary to fully describe the contracting opportunity. Contracting Officers
may hold a pre-proposal conference to answer questions and to clarify the
RFP, provided all prospective contractors are informed of the conference.
Award evaluation factors will be tailored to the acquisition, but must include
price as a factor. Others factors may include technical expertise, financial
stability of the contractor based upon a review of financial statements, and
prior contract performance. The Contracting Officer may request final
proposals from contractors in the competitive range. Based upon the review of
the proposals, a preliminary award decision will be made.

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d) If a contracting officer determines that (1) time permits the solicitation,
submission and evaluation of sealed bids; (2) award will be made only on the
basis of price or price-related factors; (3) discussions with prospective bidders
will not be necessary, and (4) there is a reasonable expectation of receiving
more than one sealed bid, the contractor may, instead of an RFP, use an
Invitation for Bids (IFB) to compete the acquisition. The IFB will set forth the
essential information necessary to fully describe the contracting opportunity.
Contracting Officers may hold a pre-bid conference to answer questions and to
clarify the IFB provided all prospective contractors are informed of the
conference. Because an IFB requires that the requirement be clearly stated
prior to issuing the solicitation, IFBs will only be used by contracting officers
under the direct control of the Head of the Contracting Activity, CPA.

e) Written justifications detailing the unique qualifications of the contractor or
other exigent circumstances requiring an award without competition will be
prepared for all Large Purchases awarded without competition. Requirements
for justifications are contained in Appendix A. All Large Purchase
justifications will be reviewed and approved in writing by either the
Contracting Officer’s appointing authority or the Head of Contracting Activity,
CPA, or his designee.

f) Except for awards by Contracting Officers appointed by the Head of
Contracting Activity or the Principal Assistant Responsible for Contracting,
CPA, Large Purchase preliminary award decisions will be reviewed by a
Contract Award Committee of at least three officials, designated by the official
who appointed the Contracting Officer for the particular project, prior to
award. The Committee will review the proposals and Contract file to ensure
compliance with procedural and competition requirements, that the contract
represents sound business judgment, that the process used was fair and
impartial, and that the proposed award represents the best value based upon the
evaluation factors. Large Purchase preliminary award decisions by
Contracting Officers appointed by the Head of the Contracting Activity, CPA
will be coordinated with the Head of Contracting Activity, CPA, or his
designee, prior to award.

g) Notwithstanding paragraph 3(e) above, Large Purchase Contracts may be
executed in the absence of a Contract Award Committee, provided the Head of
Contracting Activity, CPA, determines that there are sufficient alternative
means to ensure that the particular solicitation action has been appropriately
managed.

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h) Contracting officers are encouraged to establish payment schedules that
provide for payments as the vendor accomplishes specified performance
milestones.

4) Contract Modifications and Amendments. Contract modifications and amendments
are subject to the same documentation provisions as original contracts. Contracting
Officers must ensure the cost of the contract modification or amendment is fair and
reasonable. Amendments or modifications that are outside the scope of the contract
or that constitute new requirements should be addressed through new contracts.

Section 8
Monitoring Contract Performance

Consistent with their programmatic responsibility to ensure that contractors and grantees
properly perform their duties, Contracting Officers shall be responsible for regularly
monitoring the post-award execution of all Contracts they approve. This monitoring process
includes ensuring that the contractor provides the agree upon goods, services or construction
in accordance with the provisions, and that payments are made in a timely manner.
Contracting Officers shall include in the Contract file a written report describing post-award
performance by contractors or grantees, including a final assessment upon completion of the
Contract. Contracting officers shall rely upon locally available military engineering
resources in assessing all repair and construction projects. All documents related to the
establishment and execution of Contracts will be maintained in a Contract file that includes
the materials described in Appendix A to this Memorandum.

Section 9
Grants

Consistent with Program Review Board requirements, Grants may be made available to
support important public initiatives.

1) Applications for Grants must describe the initiative, anticipated costs and the desired
results. The applications should also set forth objective standards for measuring the
success of the Grant.

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2) In reviewing grant applications, consideration shall be given to the number of people
affected by the grant and the impact on community development. Grants should be
reviewed during implementation and where appropriate funds should be made
available on a schedule tied to the accomplishment of specific milestones specified
by the CPA or Coalition Forces, and related to the objective measures of success.

3) Although there generally is little substantial involvement between the CPA or
Coalition Forces and the grantee following the award of the Grant, a grant agreement
will be conducted according to a form prescribed by the Head of Contracting
Activity, CPA, in coordination with the Office of the General Counsel, CPA, and the
grantee’s performance must be monitored to ensure that the granted funds are
expended for appropriate purposes consistent with the Grant, and to assess the
grantee’s suitability for future Grants. Contracting Officers responsible for Grants
shall include in the Grant file a written report describing post-award performance by
or grantees, including a final assessment upon completion of the Grant.

Section 10
Funds Allocated through the National Budget Process

1) Funds allocated through the National Budget Process will be made available to the
interim Iraqi Ministries in accordance with the National Budget. The CPA Office of
Management and Budget will allocate funds to the Iraqi Ministry of Finance for
further distribution to the Iraqi Ministries, in accordance with the national Budget
and in a manner that will ensure appropriate transparency. The interim Iraqi
Ministries may draw on allocated funds by submitting a request for funds to the Iraqi
Ministry of Finance.

2) Contracts or grants executed by interim Iraqi Ministries may be carried out in
accordance with applicable Iraqi laws and Ministry contracting procedures only if
the Administrator or his designee determines that the Ministry’s application of these
controls will ensure transparency. However, in the event that a protest is filed
against the proposed award of a contract or grant, the provisions of the Protests
clause in Appendix B of this Memorandum shall apply. If the Administrator or his
designee does not determine that applicable Iraqi laws and Ministry contracting
procedures can ensure transparency in the use of Iraqi funds, the rules of this
Memorandum shall apply.

3) As part of the CPA’s responsibility to ensure that CPA Funds are used for their
intended purpose, the CPA Comptroller, in coordination with the Head of

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CONTRACT AND GRANT PROCEDURES

APPLICABLE TO VESTED AND SEIZED IRAQI PROPERTY AND DEVELOPMENT

FUND FOR IRAQ

Contract File Requirements

APPENDIX A

Micro Purchases ($5,000 or less)

Contract file must include:


Notes or documentation reflecting competition efforts, if any, including a written summary
of oral solicitations if award is based on an oral solicitation.

The basis for the award decision if other than lowest price.

Material Contract terms (Who is to do What, When, and for How much?)

Information demonstrating the outcome (such as receipts, delivery notices, notes of the
contracting officer regarding contractor performance for services).
Micro Purchase files will be maintained for 1 year following final contract payment.
Small Purchases ($5,000.01 - $500,000)

Contract file must include:


Documentation of oral solicitations made for contracts less than $25,000, written
solicitations for contracts from $25,000/01 to $5000,000.

Evidence of competition, such as posted notices (including the location and length of time
posted), direct solicitations, advertisements, posting on web pages.

For solicitations in which only one source is solicited (i.e., sole-source contract awards), a
written justification prepared in accordance with this Appendix.

Evaluation Criteria, if applicable.

Significant correspondence with vendors.

Notification to successful vendor.

Written contract containing required terms for agreements exceeding $10,000 or a summary
of material terms for agreements less than $10,000.

Invoices for progress payments and verification of performance including notes of
inspections or monitoring where appropriate.

Small Purchase Files will be maintained for 1 year following final contract payment.
Large Purchases (more than $500,000)

Documentation will be sufficient to enable review by the Contract Award Committee prior to award
and then by auditors during the period of contract performance and thereafter. Files will include:


A statement of need for the requirement to be addressed. This may be a request for services
from the agency requesting the contract.

Evidence of Competition, such as posted notices (including the location and length of time
posted), direct solicitations, advertisements, posting on web pages, or other means used to
publicize the opportunity to bid.
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All fully eligible responses from vendors to allow the Contract Award Committee to review
the contracting options to ensure the proposed contract award is based upon sound business
judgment.

For contracts in which only one source is solicited, a written justification prepared in
accordance with this Appendix.

Contract award Evaluation Criteria. Price must be one of the contract evaluation criteria.
Other criteria may include experience, prior contract performance, technical expertise, and
delivery terms.

Memorandum for record memorializing the action by the Contract Award Committee acting
to select the successful vendor. The MFR should identify board members, the bids
considered, the criteria used, and the selected vendor.

Significant correspondence with vendors.

Notification to successful vendor.

Written contract containing required terms.

Contract Modifications and Amendments.

Contract performance and outcome information including notes of inspections or monitoring
where appropriate.

Large Purchase Contract files will be maintained for a period of 3 years following final
contract payment.
Sole-Source Contracting Justification and Approval Requirements


Contracting Officers must document compelling reasons justifying sole source contracting
in all contracts. Compelling reasons that may be considered when justifying sole-source
contracting:
o
There is only one responsible source and no other supplies or service will satisfy
requirements. This may include unacceptable delays in delivery or other unique
circumstances, such as intellectual property rights or compatibility with existing
systems.
o
Unusual or compelling urgency to satisfy requirements. This justification will only be
used in cases where competition would represent a serious risk to agency objectives.
Failure to accurately forecast agency needs is a not a sufficient justification.

The justification must demonstrate the circumstances for forgoing adequate competition. If
the circumstance is urgent and compelling, specifically explain the time constraints.
Identify unique capabilities that are possessed by only one contractor.

Justifications will include a description of efforts to obtain competition.

Justifications will include facts supporting the Contracting Officer’s determination that a fair
and reasonable price was obtained.

Justifications for sole-source awards in excess of $500,000 must be approved by the
Contracting Officer’s Appointing Authority or the Head of Contracting Authority, CPA.
Grants

Files will contain a statement of the community need to be addressed and intended purposes of the
grant. Generally, the grant application is sufficient. The file will also contain outcome information
including as assessment of the community impact of the grant.

Special Requirements for Construction Projects

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Maintain engineering drawings and approvals of plans until contract performance is
complete.

Cost Estimates by independent engineers should be obtained for Large Purchase projects to
assist in the assessment of fair and reasonable value.

Fixed-priced arrangements are preferred for construction contracts.

Certificates of Completion.

Change Orders and Amendments will be fully documented.
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CONTRACT AND GRANT PROCEDURES
APPLICABLE TO VESTED AND SEIZED IRAQI PROPERTY AND
DEVELOPMENT FUND FOR IRAQ

Standard Terms and Conditions for Solicitations and Contracts in Excess of $5,000
APPENDIX B
Solicitation Terms and Conditions

1. Submission of Offers. The contractor will submit signed and dated offers to the office
specified in this solicitation at or before the exact time specified in the solicitation. Offers may be
submitted on letterhead stationery or as otherwise specified in the solicitation. At a minimum,
offers must show:
a. The solicitation number.
b. The time specified in the solicitation for receipt of offers.
c. The name, address, and telephone number of the offeror.
d. A technical description of the items being offered in sufficient detail to evaluate
compliance with the requirements in the solicitation. This may include product literature, or other
documents, if necessary.
e. Terms of any express warranty.
f. Price and any discount terms.
g. Payment address (if different from mailing address)
h. Acknowledgment of solicitation amendments (if any)
i. Past performance information, when included as an evaluation factor, to include
recent and relevant contracts for the same or similar items and other references (including contract
numbers, points of contact with telephone numbers, and other relevant information)
j. A statement specifying the extent of agreement with all terms, conditions, and
provisions included in the solicitation. Offers that fail to furnish required representations or
information, or reject the terms and conditions of the solicitation may be excluded from
consideration.
2. Period for Acceptance of Offers. The offeror agrees to hold the prices in its offer firm for
30 calendar days from the date specified for receipt of offers, unless another time period is specified
in an addendum to the solicitation.
3. Product Samples. When required by the solicitation, product samples shall be submitted at
or prior to the time specified for receipt of offers. Unless otherwise specified in this solicitation,
these samples shall be submitted at no expense, and returned at the sender’s request and expense,
unless they are destroyed by pre-award testing.
4. Multiple Offers. Offerors are encouraged to submit multiple offers presenting alternative
terms and conditions or items for satisfying the requirements of this solicitation. Each offer
submitted will be evaluated separately.
5. Late Submissions, Modifications, Revisions, and Withdrawals of Offers.
a. Offerors are responsible for submitting offers, and any modifications, revisions, or
withdrawals, so as to reach the Contracting Officer designated in the solicitation by the time
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specified in the solicitation. If no time is specified in the solicitation, the time for receipt is 1630
hours, local time, for the designated contracting office on the date that offers or revisions are due.

b. Any offer, modification, revision, or withdrawal of an offer received at the
contracting office designated in the solicitation after the exact time specified for receipt of offers is
“late” and will not be considered unless it is received before award is made, the Contracting Officer
determines that accepting the late offer would not unduly delay the acquisition, and
1) if it was transmitted through an electronic commerce method authorized by
the solicitation, it was received at the initial point of entry to the contracting office not later than
1700 hours one working day prior to the date specified for receipt of offers, or

2) there is acceptable evidence to establish it was received at the location
designated for the receipt of offers and was under government control prior to the time set
for receipt of offers, or
3) if the solicitation was a request for proposals, it was the only proposal
received.

c. However, a late modification of an otherwise successful offer that makes the offer’s
terms more favorable to the contracting organization issuing the solicitation will be considered at
any time it is received an may be accepted.
d. Acceptable evidence to establish the time of receipt at the contracting office includes
the time/date stamp of that installation on the offer wrapper, other documentary evidence of receipt
maintained by the installation, or oral testimony or statements of contracting office personnel.
e. If an emergency or unanticipated event interrupts normal processes so that offers
cannot be received at the contracting office designated for receipt of offers by the exact time
specified in the solicitation, and urgent requirements preclude amendment of the solicitation or
other notice of the extension of the closing date, the time specified for receipt of offers will be
deemed to be extended to the same time of day specified in the solicitation on the first work day on
which normal processes resume.
f. Offers may be withdrawn by written notice received at any time before the exact
time set for receipt of offers. Oral offers in response to oral solicitations may be withdrawn orally.
If the solicitation authorizes facsimile offers, offers may be withdrawn via facsimile received at any
time before the exact time set for receipt of offers, subject to the conditions specified in the
solicitation concerning facsimile offers. An offer may be withdraw in person by an offeror or its
authorized representative if, before the exact time set for receipt of offers, the identity of the person
requesting withdrawal is established and the person signs a receipt for the offer.
6. Contract Award. The Contracting Officer intends to evaluate offers and award a contract
without discussions with offerors. Therefore, the offeror’s initial offer should contain the offeror’s
best terms from a price and technical standpoint. However, the Contracting Officer reserves the
right to conduct discussions if later determined by the Contracting Officer to be necessary. The
Contracting Officer may reject any or all offers is such action is in the public interest; accept other
than the lowest-priced offer; and waive informalities and minor irregularities in offers received.
7. Multiple Awards. The Contracting Officer may accept any item or group of items of an
offer, unless the offeror qualifies the offer by specific limitations. Unless otherwise provided in the
schedule, offers may not be submitted for quantities less than those specified. The Contracting
Officer reserves the right to make an award on any item for a quantity less than the quantity offered,
at the unit prices offered, unless the offeror specifies otherwise in the offer.
CPA/MEM/19 August 2003/04

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8. Evaluation. The Contracting Office will award a contract resulting from this solicitation to
the responsible offeror whose offer conforming to the solicitation will be most advantageous to the
contracting activity, price and other factors considered. The following factor shall be used to
evaluate offers.
(Contracting Officer lists factors here, in order of importance)

9. Options. The Contracting Office will evaluate offers for award purposes by adding the total
price for all options to the total price for the basic requirement. The Contracting Officer may
determine that an offer is unacceptable if the option prices are significantly unbalanced. Evaluation
of options shall not obligate the Contracting Officer to exercise the option(s).
10. Notice of Award. A written notice of award or acceptance of an offer, mailed or otherwise
furnished to the successful offeror within the time for acceptance of the offer, shall result in a
binding contract without further action by either party. Before the offer’s scheduled expiration
time, the Contracting Officer may accept an offer (or part of an offer) whether or not there are
negotiations after its receipt, unless a written notice of withdrawal is received before award.
11. Protests. A contractor wishing to object to the terms of a solicitation, the termination of a
solicitation, the award of a contract, or the termination of the award of a contract, shall present the
matter to the Contracting Officer for an initial decision. The contractor shall state to the
Contracting Office the basis for the protest. If the contractor does not agree with the Contracting
Officer’s initial decision, the Contractor may appeal the initial decision to the Head of Contracting
Activity, CPA, for resolution. The decision of the Head of Contracting Activity, CPA, shall be the
final decision in the matter.
12. Evaluation of Foreign Currency Offers. If the Contracting Officer receives offers in more
than one currency, the Contracting Officer will evaluate offers by converting the foreign currency to
United States currency using ________________ rate in effect on the date specified for receipt of
offers, if award is based on initial offers, or, if award is based on revised offers, on the date
specified for receipt of proposal revisions.
Contract Terms and Conditions

13. Inspection/Acceptance. The Contractor shall only tender for acceptance those items that
conform to the requirements of this contract. The Contracting Officer reserves the right to inspect
or test any supplies or services that have been tendered for acceptance. The Contracting Officer
may require repair or replacement of nonconforming supplies or reperformance of nonconforming
services at no increase in contract price. The Contracting Officer must exercise the post-acceptance
rights:
a. Within a reasonable time after the defect was discovered or should have been
discovered, and
b. Before any substantial change occurs in the condition of the item, unless the change
is due to the defect in the item.
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14. Assignment. The Contractor shall not assign, transfer, or make any other disposition of this
Contract, or any part thereof, without the prior written consent of the Contracting Officer.
15. Changes. Changes in the terms and conditions of this contract may be made only by written
agreement of the parties.
16. Disputes. This contract is not subject to the Contract Disputes Act of 1978, as amended (41
U.S. Code, Sections 601-613). Failure of the parties to this contract to reach agreement on any
request for equitable adjustment, claim, appeal, or action arising under or relating to this contract
shall be a dispute to be resolved in accordance with the United States Federal Acquisition
Regulation Clause 52.233-1, Disputes, which is incorporated herein by reference except that appeals
from final decisions of a Contracting Officer may only be appealed to the U.S. Armed Services
Board of Contract Appeals (ASBCA). The decision of the ASBCA shall be final. The contractor
shall proceed diligently with performance of this contract, pending final resolution of any dispute
arising under the contract.
17. Excusable Delays. The Contractor shall be liable for default unless nonperformance is
caused by an occurrence beyond the reasonable control of the Contractor and without its fault or
negligence such as, acts of God or the public enemy, acts of the Governmental activity in either its
sovereign or contractual capacity, fires, floods, epidemics, quarantine restrictions, strikes, unusually
severe weather, and delays of common carriers. The Contractor shall notify the Contracting Officer
in writing as soon as it is reasonably possible after the commencement of any excusable delay,
setting forth the full particulars in connection therewith, shall remedy such occurrence with all
reasonable dispatch, and shall promptly give written notice to the Contracting Officer of the
cessation of such occurrence.
18. Invoice. The Contractor shall submit an original invoice and three copies (or electronic
invoice if authorized) to the address designated in the contract to receive invoices. The invoice
must include:
a. Name and address of the Contractor.
b. Invoice date and number.
c. Contract number, contract line item number, and, if applicable, the order number.
d. Description, quantity, unit of measure, unit price, and extended price of the items
delivered.
e. Shipping number and date of shipment, including the bill of lading number and
weight of shipment if shipped on a bill of lading.
f. Terms of any discount for prompt payment offered.
g. Name, title, and phone number of person to notify in event of defective notice.
19. Patent Indemnity. The Contractor shall indemnify the Government agency involved in this
contract and its officers, employees, and agents against liability, including costs, for actual or
alleged direct or indirect contributory infringement of, or inducement to infringe, any patent,
trademark, or copyright, arising out of the performance of this contract, provided the Contractor is
reasonably notified of such claims and proceedings.
CPA/MEM/19 August 2003/04

20


20. Payment. Payment shall be made for items accepted by the Contracting Officer that have
been delivered to the delivery destinations set forth in this contract. In connection with any
discount offered for early payment, time shall be computed from the date of the invoice. Fr the
purpose of computing the discount earned, payment shall be considered to have been made on the
date which appears on the payment check or the specified payment date if an electronics fund
transfer payment is made.
21. Risk of Loss. Unless the contract specifically provides otherwise, risk of loss or damage to
the supplies provided under this contract shall remain with the Contractor until, and shall pay to the
Contracting Officer:
a. Delivery of the supplies to a carrier, if transportation is f.o.b origin.
b. Delivery of the supplies to the Contracting Officer or a representative at a destination
specified in the contract, if transportation is f.o.b. destination.
22. Taxes. The contract price includes all applicable taxes and duties.
23. Termination for Convenience. The Contracting Officer reserves the right to terminate this
contract, or any part hereof, for the sole convenience of the Government activity. In the event of
such termination, the Contractor shall immediately stop all work hereunder and shall immediately
cause any and all of its suppliers and subcontractors to cease work. Subject to the terms of this
contract, the Contractor shall be paid a percentage of the contract price reflecting the percentage of
the work performed prior to the notice of termination, plus reasonable charges the Contractor can
demonstrate to the satisfaction of the Contracting Officer using its standard record keeping system,
have resulted from the termination. The Contracting Officer, upon reasonable advanced notice,
may inspect the financial records relating to this Contract’s including the amounts paid to
subcontractors and the locations where any portion of the Contractor’s performance occurs. The
Contracting Officer may review the Contractor’s financial statements upon request.
24. Termination for Cause. The Contracting Officer may terminate this contract, or any part
hereof, for cause in the event of any default by the Contractor, or if the Contractor fails to comply
with any contract terms and conditions, or fails to provide the Contracting Officer, upon request,
with adequate assurances of future performance. In the event of termination for cause, the
Government agency shall not be liable to the Contractor for any amount of supplies or services not
accepted, and the Contractor shall be liable for any and all rights and remedies provided by law. If
it is determined that the Contracting Officer improperly terminated this contract for cause, such
termination shall be deemed a termination for convenience.
25. Title. Unless specified elsewhere in this contract, title to items furnished under this contract
shall pass to the Government agency upon acceptance, regardless of when or where the Government
agency takes physical possession.
26. Warranty. The Contractor warrants and implies that the items delivered hereunder are
merchantable and fit for use for the particular purpose described in this contract.
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21


27. Immunities. Except as provided in this contract, the Government of Iraq or its agents,
including the CPA or other governmental agencies, have not waived any of their privileges or
immunities.
28. Legal Status. The Contractor is an independent contractor. The Contractor’s employees
will not be considered government employees for any purpose. The Contractor is solely responsible
for compensation agreements with employees.
29. Contractor’s Responsibility for Employees. The Contractor is responsible for the
professional and technical competence of its employees and will select reliable individuals who will
perform effectively in the implementation of this Contract, respect the local customs, and conform
to a high standard of moral and ethical conduct. The Contracting Officer may require that the
Contractor remove from the job employees who endanger persons or property, or whose continued
employment under this contract is inconsistent with the interest of military security.
30. Subcontracting. Except as authorized in this contract, the Contractor may not subcontract
any portion of the performance of this Contract to another without the prior written consent of the
Contracting Officer. The terms of any subcontract will be subject to and conform with the
provisions of this Contract.
31. Indemnification. The Contractor shall defend, indemnify, and hold harmless all
government entities involved in this contract, together with the entities’ officers, agents, and
employees from and against all suits, claims, or liabilities of any kind arising out of acts or
omissions of the Contractor, its employees, or the Contractor’s subcontractors.
32. Insurance. The Contractor represents and warrants that it shall maintain appropriate
insurance including general commercial liability and workers compensation coverage in an
adequate amount to cover third parties claims arising from or in connection with this Contract.
Upon request, the Contractor will provide satisfactory evidence of the insurance required under this
article.
33. Use of Names and Symbols. Except as required by this Contract, the Contractor will not
advertise or otherwise makes public the fact that it is a contractor to the governmental entity in this
Contract, nor will the Contractor use the name or emblem of the governmental entity for
commercial purposes.
34. Limitation of Liability. Except as otherwise provided by an express warranty, the
Contractor will not be liable to the governmental entity for consequential damages resulting from
any defect or deficiencies in accepted items.
35. Inconsistency between English Version and Translation of Contract. In the event of
inconsistency between any terms of this contract and any transaction into another language, the
English language meaning shall control.
36. Correspondence in English. The Contractor shall ensure that all contract correspondence
that is addressed to the governmental entity awarding this contract is submitted in English or with
an English translation.
CPA/MEM/19 August 2003/04

22


37. Conflicts of Interest. The Contractor warrants that no governmental official has received
or will be offered by the Contractor any direct or indirect benefit in connection with or arising from
the award of this contract. The Contractor agrees that any breach of this provision is a breach of an
essential term of this Contract.
38. Order of Precedence (except for Construction Contracts). Any inconsistencies in this
solicitation or contract shall be resolved by giving precedence in the following order:
a. The schedule of supplies/services.
b. The Assignments, Disputes, Payments, Invoice, Other Compliances clauses of this
contract.
c. Addenda to this solicitation or contract, including any license agreements for
computer software.
d. Solicitation provisions (if this is a solicitation)
e. The other standard clauses in this contract.
f. Other documents, exhibits, and attachments.
g. The specification (the narrative description of the work)
39. Other Compliances. The Contractor shall comply with all applicable laws, rules, and
regulations applicable to its performance under this contract.
40. Source of Funds. The obligation under this contract is made with Iraqi Funds, as defined in
CPA Memorandum Number 4, dated 19 August 2003. No funds, appropriated or other, of any
Coalition country are or will be obligated under this contract.
41. Option to Extend the Term of the Contract.
a. The governmental entity awarding this contract may extend the term of this contract
by written notice to the Contractor within _______ days (insert number of days) prior to the end of
the term of the contract, or the end of any option period previously exercised under the contract;
provided that the Government entity gives the Contractor a preliminary written notice of its intent to
extend at least _______ (insert number of days) before the contract period (including option periods
exercised ) expires. The preliminary notice does not commit the governmental entity to an
extension. If the Government exercises this option, the extended contract shall be considered to
include this clause.
b. At the end of the contract period, or at the end of the final option period under this
contract, whichever is later, if the governmental entity requires continued performance of services
within the limits and at the rates specified in the contract for an additional period not to exceed six
months, by giving written notice to the Contractor at least _____ days before the end of the contract
period or the end of the final option period exercised, whichever is later.
42. Liquidated Damages.
a. If the Contractor fails to perform within the time specified in this contract, the
Contractor shall, in place of actual damages, pay to the governmental entity liquidated damages of
$__________________ per calendar day of delay.
b. If the governmental entity terminates this contract in whole or in part under the
Termination for Cause clause, the Contractor is liable for liquidated damages accruing until the
governmental entity reasonably obtains similar delivery or performance. These liquidated damages
CPA/MEM/19 August 2003/04

23


are in addition to excess costs of repurchase under the Termination for Cause clause.

c. The Contractor will not be charged with liquidated damages when the delay in
delivery or performance is beyond the control and without the fault or negligence of the Contractor
as defined in the Excusable Delay clause.
Construction Contract Terms and Conditions (For Construction Contracts Only)

43. Performance of Work by the Contractor. The Contractor shall perform on the site, and with
its own organization, work equivalent to at least _____ percent of the total amount of work to
be performed under the contract. This percentage may be reduced by a supplemental agreement to
this contract if, during performing the work, the Contractor requests a reduction and the Contracting
Officer determines that the reduction would be to the advantage of the Government.
44. Differing Site Conditions.
a. The Contractor shall promptly, and before the conditions are disturbed, give a
written notice to the Contracting Officer of:
(1) Subsurface or latent physical conditions at the site which differ materially
from those indicated in the Contract, or
(2) Unknown physical conditions at the site, of an unusual nature, which differ
materially from those ordinarily encountered and generally recognized as inhering in work of the
character provided for in the contract.
b. The Contracting Officer shall investigate the site conditions promptly after receiving
the notice. If the conditions do materially so differ and cause an increase or decrease in the
Contractor's cost of, or the time required for, performing any part of the work under this contract,
whether or not changed as a result of the conditions, an equitable adjustment shall be made under
this clause and the contract modified in writing accordingly.
c. No request by the Contractor for an equitable adjustment to the contract shall be
allowed, unless the Contractor has given the written notice required; provided, that the time
prescribed in paragraph (a) of this clause for giving written notice may be extended by the
Contracting Officer.
d. No request by the Contractor for an equitable adjustment to the contract for differing
site conditions shall be allowed if made after final payment under this contract.
45. Site Investigation and Conditions Affecting the Work.
a. The Contractor acknowledges that it has taken steps reasonably necessary to
ascertain the nature and location of the work, and that it has investigated and satisfied itself as to the
general and local conditions which can affect the work or its cost, including but not limited to (1)
conditions bearing upon transportation, disposal, handling, and storage of materials; (2) the
availability oflabor, water, electric power, and roads; (3) uncertainties of weather, river stages, tides,
or similar physical conditions at the site; (4) the conformation and conditions of the ground; (5) the
character of equipment and facilities needed preliminary to and during work performance. The
Contractor also acknowledges that it has satisfied itself as to the character, quality, and quantity of
surface and subsurface materials or obstacles to be encountered insofar as the information is
reasonably ascertainable from an inspection of the site, including all exploratory work done by the
governmental agency involved, as well as from the drawing and specifications made a part of this
contract. Any failure of the Contractor to take the action described and acknowledged in this
CPA/MEM/19 August 2003/04

24


paragraph will not relieve the Contractor from responsibility for estimating properly the difficulty
and cost of successfully performing the work, or for proceeding to successfully perform the work
without additional expense to the governmental agency involved.

b. The governmental agency involved in this contract assumes no responsibility for
any conclusions or interpretations made by the Contractor based on the information made available
by the Government, nor does the governmental agency assume responsibility for any understanding
reached or representation made concerning conditions which can affect the work by any of its
officers or agents before the execution of this contract, unless that understanding or representation is
expressly stated in this contract.
46. Material and Workmanship.
a. All equipment, material, and articles incorporated into the work covered by this
contract shall be new and of the most suitable grade for the purpose intended, unless otherwise
specifically provided in this contract. References in the specifications to equipment, material,
articles, or patented processes by trade name, make, or catalog number, shall be regarded as
establishing a standard of quality and shall not be construed as limited competition. The Contractor
may, at its option, use any equipment, material, article, or process that, in the judgment of the
Contracting Officer, is equal to that named in the specifications, unless
otherwise specifically provided in this contract. ..
b. The Contractor shall obtain the Contracting Officer's approval of the machinery
and mechanical and other equipment to be incorporated into the work. When requesting approval,
the Contractor shall furnish to the Contracting Officer the name of the manufacturer, the model
number, and other information concerning the performance, capacity, nature, and rating of the
machinery and mechanical and other equipment. When required by this contract or by the
Contracting Officer, the Contractor shall also obtain the Contracting Officer's approval of the
material or articles which the Contractor contemplates incorporating into the work:- When
requesting approval, the Contractor shall provide full information concerning the material or
articles. When directed to do so, the Contractor shall submit samples for approval at the Contractor's
expense, with all shipping charges prepaid. Machinery, equipment, material, and articles that do not
have the required approval shall be installed or used at the risk of subsequent rejection.
c. All work under this contract shall be performed in a skillful and workmanlike
manner. The Contracting Officer may require, in writing, that the Contractor remove from the work
any employee the Contracting Officer deems incompetent, careless, or otherwise objectionable.
47. Superintendence by the Contractor. At all times during performance of this contract and
until the work is completed and accepted, the Contractor shall directly superintend the work or
assign and have on the worksite a competent superintendent who is satisfactory to the Contracting
Officer and has authority to act for the Contractor.
48. Permits and Responsibilities. The Contractor shall, without additional expense to the
governmental entity awarding this contract, be responsible for obtaining any necessary licenses and
permits, and for complying with any laws, codes, or regulations applicable to the performance of
the work. The Contractor shall also be responsible for all damages to persons or property that occurs
as a result of the Contractor's fault or negligence. The Contractor shall also be responsible for all
materials delivered and work performed until completion and acceptance of the entire work, except
CPA/MEM/19 August 2003/04

25


for any completed unit of work which may have been accepted under the contract.

49. Protection of Existing Vegetation, Structures, Equipment, Utilities, and Improvements.
a. The Contractor shall preserve and protect all structures, equipment, and vegetation
(such as trees, shrubs, and grass) on or adjacent to the work site, which are not to be removed and
which do not unreasonably interfere with the work required under this contract. The Contractor
shall only remove trees when specifically authorized to do so, and shall avoid damaging vegetation
that will remain in place. If any limbs or branches of trees are broken during contract performance,
or by the careless operation of equipment, or by workmen, the Contractor shall trim those limbs or
branches with a clean cut and take such other action as the Contracting officer may direct.
b. The Contractor shall protect from damage all existing improvements and utilities
(1) at or near the work site, and (2) on adjacent property of a third party, the locations of which are
made known to or should be known by the Contractor. The Contractor shall repair any damage to
those facilities, including those that are the property of a third party, resulting from failure to
comply with the requirements of this contract or failure to exercise reasonable care in performing
the work. If the Contractor fails or refuses to repair the damage pr°l11.ptly, the Contracting Officer
may have the necessary work performed and charge the cost to the Contractor.
50. Operations and Storage Areas.
a. The Contractor shall confine all operations (including storage of materials) to areas
authorized or approved by the Contracting Officer. The Contractor shall hold and save the
government entity awarding this contract, its officers and agents, free and harmless from liability of
any nature occasioned by the Contractor's performance.
b. Temporary buildings (such as storage sheds, shops, offices) and utilities may be erected
by the Contractor only with the approval of the Contracting Officer and shall be built with labor and
materials furnished by the Contractor without expense to the governmental entity awarding this
contract. The temporary buildings and utilities shall remain the property of the Contractor and shall
be removed by the Contractor at its expense upon completion of the work. With the written consent
of the Contracting Officer, the buildings and utilities may be abandoned and need not be removed.
c. The Contractor shall, under rules established by the Contracting Officer, use only
established roadways, or use temporary roadways constructed by the Contractor when and as
authorized by the Contracting Officer. When materials are transported in prosecuting the work,
vehicles shall not be loaded beyond the loading capacity recommended by the manufacturer of the
vehicle or prescribed by law or regulation. When it is necessary to cross curbs and sidewalks, the
Contractor shall protect them from damage. The Contractor shall repair or pay for the repair of any
damaged curbs, sidewalks, or roads.
51. Cleaning Up. The Contractor shall at all times keep the work area, including storage areas,
free from accumulations of waste materials. Before completing the work, the Contractor shall
remove from the work and premises any rubbish, tools, scaffolding, equipment, and materials that
are not the property of the Government. Upon completing the work, the Contractor shall leave the
work area in a clean, neat, and orderly condition satisfactory to the Contracting Officer.
52. Accident Prevention.
a. The Contractor shall provide and maintain work environments and procedures which will:
(1) Safeguard the public and governmental entity personnel, property, materials,
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26


supplies, and equipment exposed to Contractor operations and activities,

(2) Avoid interruptions of governmental entity operations and delays in project
completion dates, and
(3) Control costs in the performance of this contract.
b. For these purposes on contracts for construction or dismantling, demolition, or
removal of improvements, the Contractor shall:
(1) Provide appropriate safety barricades, signs, and signal lights.
(2) Ensure that any additional measures the Contracting Officer determines to be
reasonably necessary for the purposes are taken.
c. Whenever the Contracting Officer becomes aware of any noncompliance with these
requirements or any condition which poses a serious or imminent danger to the health and safety of
the public or governmental entity personnel, the Contracting Officer shall notify the Contractor
orally, with written confirmation, and request immediate initiation of corrective action. This notice,
when delivered to the Contractor or the Contractor's representative at the work site, shall be deemed
sufficient notice of the noncompliance and that corrective action is required. After receiving the
notice, the Contractor shall immediately take corrective action. If the Contractor fails or refuses to
promptly take corrective action, the Contracting Officer may issue an order stopping all or part of
the work until satisfactory corrective action has been taken. The Contractor shall not be entitled to
any equitable adjustment of the contract price or extension of the performance schedule on any stop
work order issued under this clause.
d. The Contractor shall insert this clause, including this paragraph (d), with appropriate
changes in the designation of the parties, in subcontracts.
53. Schedules for Construction Contracts.
a. The Contractor shall, within five days after the work commences on the contract
or another period of time determined by the Contracting Officer, prepare and submit to the
Contracting Officer for approval three copies of a practicable schedule showing the order in which
the Contractor contemplates starting and completing the several salient features of the work
(including acquiring materials and equipment). The schedule shall be in the form of a progress chart
of suitable scale to indicate approximately the percentage of work scheduled for completion by any
given date during the period. If the Contractor fails to submit a schedule within the time prescribed,
the Contracting Officer may withhold approval of progress payments until the Contractor submits
the required schedule.
b. The Contractor shall report progress under the schedule to the Contracting Officer as
directed by the Contracting Officer. If, in the opinion of the Contracting Officer, the Contractor falls
behind the approved schedule, the Contractor shall take steps necessary to improve its progress,
including those that may be required by the Contracting Officer, without additional cost to the
governmental entity awarding this contract. In this circumstance, the Contracting Officer may
require the Contractor to increase the number of shifts, overtime operations, days of work, and other
efforts, and to submit for approval any supplementary schedule or schedules as the Contracting
Officer deems necessary to demonstrate how the approved rate of progress will be regained.
c. Failure of the Contractor to comply with the requirements of the Contracting
Officer under this clause shall be grounds for a determination by the Contracting Officer that the
Contractor is not prosecuting the work with sufficient diligence to ensure completion within the
time specified in the contract. Upon making this determination, the Contracting Officer may
terminate the Contractor's right to proceed with the work, or any separable part of it, in accordance
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27


with the default terms of the contract.

54. Specifications and Drawings for Construction. The Contractor shall keep on the work site
a copy of the drawings and specifications (the written description of the work) and shall at all times
give the Contracting Officer access thereto. Anything mentioned in the specifications and not in the
drawings, or shown on the drawings and not mentioned in the specifications, shall be of like effect
as if shown or mentioned in both. In case of difference between drawings and specifications, the
specifications shall govern. If case of difference in the figures between the drawings or in the
specifications, the matter shall be promptly submitted to the Contracting
Officer, who shall promptly make a determination in writing. Any adjustment by the Contractor
without such a determination shall be at its own risk and expense. The Contracting Officer shall
furnish from time to time such detailed drawings and other information as considered necessary,
unless otherwise provided.
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CONTRACT AND GRANT PROCEDURES

APPLICABLE TO VESTED AND SEIZED IRAQI PROPERTY AND DEVELOPMENT

FUND FOR IRAQ

Guidance for Issuing Grants
APPENDIX C

Considerations for Drafting Grant Agreements of Solicitations for Grant Proposals.


Identify the objectives of the grant and need for assistance. Pinpoint any relevant physical,
economic, social, financial, institutional, or other problems to be addressed by the grant.

Consider the anticipated results or benefits expected. Identify costs and benefits to be
derived. For example, show how problem will be improved as a result of the grant. Explain
how the project will benefit the public.

Examine the execution approach. List the activities in chronological order to show that
schedule of accomplishments and expected completion dates. Identify the kinds of data to
be collected and maintained, and discuss the criteria to be used to evaluate the results and
success of the project. Explain the methodology that will be used to determine if the needs
identified and discussed are being met and if the results and benefits identified are being
achieved. List each organization, cooperator, consultant, or other key individuals who will
work on the project along with a short description of the nature of their effort or
contribution.

Develop assessment and control measures. Establish criteria for judging the effectiveness
and value of the grant. For larger grants, progress payments or other control measures
should be included to ensure the grant is used effectively.
Executing Grants


Grants may be made to government entities or other organizations for purposes benefiting
the public good. Small reconstruction and public works projects, as well as projects that
positively impact education and health care, may be appropriate for grants.

Grant agreements will be recorded on forms prescribed by the Head of Contracting Activity,
CPA, in consultation with the Office of the General Counsel, CPA.

When executing grants ensure the granted understands the purpose of the grant and the need
to exercise fiscal responsibility including obtaining receipts for significant payments and for
documenting the use of funds.

Conduct periodic inspections of the grant activity to ensure the grant is being used
appropriately.
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CONTRACT AND GRANT PROCEDURES

APPLICABLE TO VESTED AND SEIZED IRAQI PROPERTY AND DEVELOPMENT

FUND FOR IRAQ

Frequently Asked Questions

APPENDIX D

What projects are appropriate for the expenditure of DFI Funds?

UN Security Council Resolution 1483 (2003) provides the following:

14. Underlines that the Development fund for Iraq shall be used in a transparent manner to meet
the humanitarian needs of the Iraqi people, for the economic reconstruction and repair of Iraq’s
infrastructure, for the continued disarmament of Iraq, and for the costs of Iraqi civilian
administration, and for other purposes benefiting the people of Iraq;
This is the standard for use of DFI funds. If the contracting requirement does not fit squarely within
these categories, other funding sources must be used. Requirements for the support of Coalition
Forces may not be satisfied with DFI funds.

What special rules apply for contracts with Iraqi Funds?

Obligations under contracts with Iraqi Funds will be satisfied only with Iraqi Funds. A special
clause is included in the contract to put all parties on notice of this important issue.

Military Units: Military units should not execute contracts in their names or in the name of their
government for projects using Iraqi Funds. These contracts must contain the following language:

“This contract/grant is entered into under the authority of the Administrator as head of the
Coalition Provisional Authority (CPA), which is temporarily exercising governmental
authority in Iraq pursuant to the law and usages of war and relevant United Nations Security
Council Resolutions, including Resolution 1483 (2003) (“Coalition”) and
by________________________(“Contractor”)

Coalition Provisional Authority: In order to clearly stat the authority upon which the contract is
being entered into, the clause set forth above must be included in each contract.

The CPA’s authority is of limited duration and will terminate upon the establishment of an
internationally recognized, representative government of Iraq. Therefore, it is important to ensure
there is a “termination for convenience” clause in each contract.

Ministries of the Iraqi Government: Ministries of the Iraqi government should use Iraqi
government contracting procedures when using CPA Funds, if the Administrator determines that the
contracting procedures are adequate. If those procedures are inadequate, these procedures will be
used.

CPA/MEM/19 August 2003/04

30


When should I use a grant and when should I use a contract?

When the primary purpose is to support or stimulate the efforts of the recipient rather that to acquire
a product or service, grants may be made to community agencies in support of community
development or outreach programs. Grants have more limited oversight and are intended to allow
the applicant greater flexibility. While the effectiveness of the grant should be assessed, the
requirement need not be filled by another source if the intended aims are not achieved. Grants are
generally awarded to government entities and non-profit organizations.

Contracts are used to acquire goods or services.

What factors should be used when evaluating potential contractors?

The requirements for each contract should be tailored to the acquisition. However all decisions to
award contracts should involve consideration of the following factors:


Value. While price is very important in determining a contract award, it ensuring the
performance of the contract in responsible manner is also important.

Financial Stability of Contractor. The financial stability of the contractor must be evaluated
in all Large Purchase contracts or contracts involving a substantial percentage payment of
the full contract award in advance. This review should include an analysis of its financial
statements; audits where possible; credit reports; and other data assessing the fitness of the
company.

Past Performance. Past performance should be considered if the entity has performed
previous services.
CPA/MEM/19 August 2003/04

31

This work is in the public domain in the United States because it is a work of the United States federal government (see 17 U.S.C. 105).