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HomeMy WebLinkAboutContract 29063 08-25-03 P12:29 IN TCEQ FORM : TCEQ STATE FUNDED GRANT AGREEMENT Fiscal Year 2004 and 2005 -� A09: 13 IN CITY SECRETARY CONTRACT NO. 582-4-64434 :; IVTRAC'1 No. THIS AGREEMENT is entered by and between Texas Commission on Environmental Quality (hereinafter called TCEQ) and the City of Fort Worth,Texas (hereinafter called PERFORMING PARTY). TCEQ and PERFORMING PARTY, in consideration of the mutual covenants hereinafter set forth, agree as follows: ARTICLE 1. WORK 1.1 PERFORMING PARTY shall complete all Work related to Work Plan activities as specified in the Contract Documents for those activities identified in the City Fort Worth,Texas,related portion of Exhibit A-21 Local Air Program Work Plan for the term of this Agreement. Work is generally described in this article. 1.2 By statutory authority, FY 2004-2005 Appropriations Bill (Rider 5), as an eligible local air pollution program, the PERFORMING PARTY will provide air pollution control activities from the following menu of Agreement deliverables: 1.2.1 Comprehensive Compliance Investigations(CCI) 1.2.1.1 ANBI: CCI Investigations at Sources of Interest to the EPA. 1.2.1.2 NMNC: Non-Major Non-Checklisted Source CCI Investigations 1.2.1.3 NMCL: Non-Major Checklisted Source CCI Investigations 1.2.2 Complaint Investigations 1.2.2.1 COMPLAINT: Complaint Investigations (]mown as CMPL in FY02) 1.2.3 Pre-Construction/Modification Permit Investigations 1.2.3.1 PMSI and POSI: Permit Site Reviews (Stationary and Portable permits respectively) 1.2.3.2 PMPR: Permit Provisions Reviews 1.2.4 New Source Review Permit (NSR) Compliance Investigations 1.2.4.1 NSR1: On-Site NSR Level 1 review of all non-flexible permit NSR authorizations at a site . 1.2.4.2 NSR2: On-Site NSR Level 2 permits review limited to flexible permits. 1.2.4.3 NSR3: On-Site NSR Level 3,In-Depth Investigation of Preconstruction Authorization, Determining VOC emissions from Organic Process Leaks(OpLeaks) from cooling towers or Component Leak Detection and Repair programs 1.2.5 On Site Burn Investigations 1.2.5.1 BURN: Investigations related to outdoor burning and burning approvals 1.2.6 Enforcement Follow-up Investigations. 1.2.6.1 FI/RR: Enforcement Followup Investigations (]mown as STTR in FY02) 1.2.6.2 ENF FI: Agreed Order followup Investigations(known as BDOF in FY02) 1.2.7 Mobile Source Related Investigations 1.2.7.1 BD04: Investigation of vehicle emissions controls at used car lots 1.2.7.2 BD 14: Fuel Oxygenate Determination Investigations 1.2.7.3 BD05-RVP: Determination of Gasoline Reid Vapor Pressure Investigations 1.2.8 Upset or Maintenance Event(Emissions Event) Investigations 1.2.8.1 UML1: Level 1 Upset/Maintenance(U/M) Investigation of a Single Event(or related events) requiring immediate on-site response. 1.2.8.2 UML2: Level 2 Upset/Maintenance Investigations covering all ulm activitv at a site e past year. r 1.2.8.3 IMAI or IUPS: Level 3 Upset/Maintenance Investigation of a Co } related events)not requiring immediate on-site response. 1.2.8.4 UML4: Level 4 Upset/Maintenance Investigation of a Non-Complex Single Event (or related events)not requiring immediate on-site response. 1.2.8.5 RCAPP/RCAP: Review of a Corrective Action Plan Proposal (RCAPP) as a response to a finding of an excessive emissions event determination by the Executive Director of the TCEQ or an assessment of a regulated entity against the requirements of an approved Corrective Action Plan (RCAP). 1.2.9 Title V Permit Compliance Certification Investigations 1.2.9.1 SPCC: On-Site Permit Compliance Certification Review 1.2.9.2 OPCC: In-Office Permit Compliance Certification Review 1.2.10 Generic Compliance Investigation Report Review Investigations 1.2.10.1 INES, INSP, RR07,RR63,RRGR: Investigations related to reviewing reports received from sources subject to the National Emissions Standards for Hazardous Air Pollutants (NESHAPs,40 CFR 61), the New Source Performance Standards(HSPS,40 CFR 60), 30 TAC 117, related to Nitrogen Oxide requirements, the Hazardous Organic NESHAPS (the HON and MACT standards,40 CFR 63), and reports driven by other applicable requirements, including 30 TEXAS AD rmSTRATIVE CODE Chapter 116, Permits (30 TAC Chapter 116),respectively. 1.2.11 Stack Testing Investigations 1.2.11.1 PRES: Pre-test meeting investigations 1.2.11.2 OBPT/OBCC: Observation of Performance Test or CEM Certification Test, respectively 1.2.11.3 RPFT: Review of Stack Test report 1.2.12 Stage 11 Vapor Recovery Investigations 1.2.12.1 Stage II System Test Observations 1.2.12.2 Stage II Compliance Evaluation Investigations (CEI) 1.2.12.3 Stage H Follow-up Investigations 1.2.12.4 Stage H Record Review Investigations 1.2.13 Enforcement Activities 1.2.13.1 Issuance of Notices of Violation 1.2.13.2 Enforcement Case Development,Issuance of Notice of Enforcement and Enforcement Referral 1.2.14 Other Investigation Related Activities 1.2.14.1 Investigation Quality Review Activities 1.2.14.2 Investigator Professional Development Program Development and Implementation 1.2.14.3 Visibility Project Support 1.2.14.4 Special Investigation Training/Equipment 1.3 The intended outcome is the PERFORMING PARTY's assistance to the TCEQ in the enforcement of the Clean Air Act. ARTICLE 2. AGREEMENT TERMS 2.1 This Agreement shall have a term commencing on September 1, 2003 and shall terminate on August 31, 2005. The Annual Performance Evaluation requirements identified in the Scope of Work Section and certain reporting requirements as identified in this Agreement shall survive the termination of this Agreement. Other than for administrative matters, this Agreement shall not extend into a fiscal year for which the Texas Legislature has not appropriated funding necessary to perform this Agreement. ARTICLE 3. AGREEMENT AMOUNT TCEQ SFG Agreement. Contract No.582-4-64434 Page 2 June 19,2003 related events)not requiring immediate on-site response. 1.2.8.4 UML4: Level 4 Upset/Maintenance Investigation of a Non-Complex Single Event (or related events)not requiring immediate on-site response. 1.2.8.5 RCAPP/RCAP: Review of a Corrective Action Plan Proposal (RCAPP)as a response to a finding of an excessive emissions event determination by the Executive Director of the TCEQ or an assessment of a regulated entity against the requirements of an approved Corrective Action Plan (RCAP). 1.2.9 Title V Permit Compliance Certification Investigations 1.2.9.1 SPCC: On-Site Permit Compliance Certification Review 1.2.9.2 OPCC: In-Office Permit Compliance Certification Review 1.2.10 Generic Compliance Investigation Report Review Investigations 1.2.10.1 INES, INSP,RR07,RR63,RRGR: Investigations related to reviewing reports received from sources subject to the National Emissions Standards for Hazardous Air Pollutants (NESHAPs, 40 CFR 61),the New Source Performance Standards (NSPS, 40 CFR 60), 30 TAC 117,related to Nitrogen Oxide requirements, the Hazardous Organic NESHAPS (the HON and MACT standards,40 CFR 63), and reports driven by other applicable requirements, including 30 TEXAS ADMINISTRATIVE CODE Chapter 116,Permits (30 TAC Chapter 116),respectively. 1.2.11 Stack Testing Investigations 1.2.11.1 PRES: Pre-test meeting investigations 1.2.11.2 OBPT/OBCC: Observation of Performance Test or CEM Certification Test, respectively 1.2.11.3 RPFT: Review of Stack Test report 1.2.12 Stage If Vapor Recovery Investigations 1.2.12.1 Stage If System Test Observations 1.2.12.2 Stage II Compliance Evaluation Investigations (CEI) 1.2.12.3 Stage II Follow-up Investigations 1.2.12.4 Stage II Record Review Investigations 1.2.13 Enforcement Activities 1.2.13.1 Issuance of Notices of Violation 1.2.13.2 Enforcement Case Development,Issuance of Notice of Enforcement and Enforcement Referral 1.2.14 Other Investigation Related Activities 1.2.14.1 Investigation Quality Review Activities 1.2.14.2 Investigator Professional Development Program Development and Implementation 1.2.14.3 Visibility Project Support 1.2.14.4 Special Investigation Training/Equipment 1.3 The intended outcome is the PERFORMING PARTY'S assistance to the TCEQ in the enforcement of the Clean Air Act. ARTICLE 2. AGREEMENT TERMS 2.1 This Agreement shall have a term commencing on September 1, 2003 and shall terminate on August 31, 2005. The Annual Performance Evaluation requirements identified in the Scope of Work Section and certain reporting requirements as identified in this Agreement shall survive the termination of this Agreement. Other than for administrative matters, this Agreement shall not extend into a fiscal year for which the Texas Legislature has not appropriated funding necessary to perform this Agreement. ARTICLE 3. AGREEMENT AMOUNT TCEQ SFG Agreement. Contract No.582-4-64434 Page 2 June 19,2003 3.1 TCEQ and PERFORMING PARTY agree that the maximum amount to be paid by TCEQ for completion of the Work shall not exceed$549,100 over the contract term, limited in a given fiscal year to that amount identified on Table 1, line 67 of Exhibit A-21 for the Performing Party, unless the parties amend this amount in accordance with the Agreement Documents. 3.2 The term"Local Air Program" is defined as the eligible local air pollution program conducted by PERFORMING PARTY under Section 382.0622,Texas Health and Safety Code. The combined federal and state share of the funding for the PERFORMING PARTY's Local Air Program (including the state funds under this Agreement) shall not exceed 67% (sixty-seven percent)of the PERFORMING PARTY's total cost for the program. The PERFORMING PARTY must provide matching funds such that the combined federal share, derived from the Section 105 pass-through funding from the TCEQ,and the state share, derived from the current Appropriations Act(Rider 5), shall not exceed 67%, or the total amount of this Agreement will be reduced proportionately so that this condition is met. ARTICLE 4. PAYMENT PROCEDURES 4.1 PERFORMING PARTY shall submit requests for Payment in accordance with Article 7 of the General Conditions. 4.2 Quality. All investigations and investigation documentation must be prepared in accordance with applicable Field Operations Division Standard Operating Procedures (FODSOP),published protocols and guidance documents,and Enforcement Division Standard Operating Procedures (EnfSOP). Adherence to FODSOP, issued protocols and guidance,and EnfSOP are required for the successful completion of any investigation. ARTICLE 5. BASES FOR CALCULATING PAYMENT 5.1 The PERFORMING PARTY shall receive the dollar amount as specified and agreed upon for all properly rendered and received environmental services, investigations and related items as described in Scope of Work Section and detailed within Exhibit A-21: Local Air Program Work Plan for the specified fiscal year of the term of this Agreement. 5.2 Investigations of Non-Major Sources that are subject to more than one chapter(whether state or federal rule) shall be considered one investigation for payment purposes. ARTICLE 6. FUNDING 6.1 Availability of Funds. The parties agree that this Agreement and all claims, suits,or obligations arising under or related to this Agreement are subject to and limited to the availability of funds appropriated by the Texas Legislature for the purposes of this Agreement or for the respective claim, suit, or obligation, as applicable. 6.2 Source of Funds and Legal Authority. This Agreement is funded through the FY2004-2005 Appropriations Act; TEX.WATER CODE_�5.229:TEX.HEALTH AND SAFETY CODE 382-111-382.115. The PERFORMING PARTY certifies that it has authority to perform the services contracted for by authority granted in City of Fort Worth City Code 16, Article IX,Fort Worth Air Pollution Ordinance. This Agreement is subject to: the Uniform Grant and Contract Management Act(UGCMA), Texas Government Code, Section 783.001 et seq., and the Uniform Grant Management Standards (UGMS) for State Agencies, 1 Texas Administrative Code, Section 5.141 et seq. TCEQ SFG Agreement. Contract No.582-4-64434 Page 3 June 19,2003 6.3 PERFORMING PARTY agrees to place this notice in all subgrants and subcontracts. ARTICLE 7. PERFORMING PARTY'S REPRESENTATIONS In order to induce TCEQ to enter into this Agreement,PERFORMING PARTY makes the following representations: 7.1 PERFORMING PARTY is familiar with and understands all federal, state and local Laws and Regulations that may affect cost,progress,performance or furnishing of the Work. 7.2 PERFORMING PARTY is aware of the general nature of work to be performed by TCEQ and others that relate to the Work as indicated in the Agreement Documents. 7.3 PERFORMING PARTY has given TCEQ written notice of all conflicts, errors, ambiguities or discrepancies that PERFORMING PARTY has discovered in the Agreement Documents and the written resolution thereof by TCEQ is acceptable to PERFORMING PARTY, and the Agreement Documents are generally sufficient to indicate and convey understanding of all terms and conditions for performance and furnishing of the Work. 7.4 PERFORMING PARTY hereby ratifies and attests to all certifications and deliverables it has provided to TCEQ during the offer process and agrees to give prompt written notice to TCEQ if there is any material change in these certifications or deliverables. ARTICLE 8. AGREEMENT DOCUMENTS The Agreement Documents which comprise the entire Agreement between TCEQ and PERFORMING PARTY concerning the Work consist of the following which are attached to and incorporated herein: 8.1 The TCEQ Form: TCEQ State Funded Grant Agreement 8.2 Scope of Work Section of the TCEQ State Funded Grant Agreement. 8.3 The General Conditions of the TCEQ State Funded Grant Agreement. 8.4 Other Documents 8.4.1 Exhibits Exhibits A-1 through A-20: Reserved. Exhibit A-21: Local Air Program Work Plan Available electronically only as Quattro Pro spreadsheet filename: "Consolidated LP RAT.wb3" on the T-Net at: http://home.tceq.state.tx.us/intemal/enforcement/air_inspect/index.htm Exhibit A-22: Work Plan Pricing Matrix Available electronically as the"Pricing Matrix"tab of Exhibit A-21 8.4.2 FORMS Form B-1: HUB/MWBE Progress Assessment Report Form B-2: TCEQ STATE PURCHASE VOUCHER Form B-3: TCEQ Invoice Form B-4: Financial Status Report Form B-5: Fiscal Analysis Package TCEQ SFG Agreement. Contract No.582-4-64434 Page 4 June 19,2003 8.5 The following which may be delivered or issued after the Effective Date of the Agreement and are not attached hereto: Work Plan Amendments, all Written Amendments, and other documents amending, modifying or supplementing the Agreement Documents pursuant to the General Conditions. 8.6 There are no Agreement Documents other than those listed above in this Article. The Agreement Documents may be amended,modified or supplemented only as provided in this Agreement. ARTICLE 9. MISCELLANEOUS 9.1 Terms used in this Agreement which are defined in Article 1 of the General Conditions will have the meanings indicated in the General Conditions. 9.2 Notwithstanding any provisions relating to assignment in the Uniform Commercial Code,no delegation by a party hereto of any duties or obligations nor assignment by a party hereto of any rights under or interests in the Agreement Documents will be binding on another party hereto without the written consent of the party sought to be bound;and, specifically but without limitation,monies that may become due and monies that are due may not be assigned without such consent(except to an extent that the effect of this restriction may be limited by law), and unless specifically stated to the contrary in any written consent to an assignment, no assignment will release or discharge the assignor from any duty or responsibility under the Agreement Documents. 9.3 TCEQ and PERFORMING PARTY each binds itself, its partners, successors, assigns and representatives to the other party hereto, its partners, successors, assigns and representatives in respect to all covenants, Agreements and obligations contained in the Agreement Documents. This Agreement is not transferable or otherwise assignable by the PERFORMING PARTY without the written consent of the TCEQ and any attempted transfer without such consent is void. 9.4 The parties hereby agree that this Agreement does not waive the State's sovereign immunity relating to suit, liability, and the payment of damages. 9.5 Any provision of the Agreement Documents held to be void or unenforceable under any Laws or Regulations shall be deemed stricken, and all remaining provisions shall continue to be valid and binding upon TCEQ and PERFORMING PARTY,who agree that Agreement Documents shall be reformed to replace such stricken provision or part thereof with a valid and enforceable provision that comes as close as possible to expressing the intention of the stricken provision. 9.6 The PERFORMING PARTY acknowledges and agrees that because this Agreement has been executed, and will be administered in Travis County, the Agreement is to be performed in said County. The PERFORMING PARTY acknowledges and agrees that any permissible cause of action involving this Agreement will arise solely in Travis County. If a legal action related to this claim is permissible and there are two (2) or more counties of proper venue under the rules of mandatory,general, or permissive venue,and one such county is Travis County, the PERFORMING PARTY hereby agrees to venue in Travis County. This provision does not waive TCEQ's sovereign immunity. 9.7 Any notice issued pursuant to these Agreement Documents shall be addressed to the respective party at the addresses set out below,or at such other address as they have theretofore specified by written notice. Such notices shall be sent by certified mail,return receipt requested, or by nationally recognized courier, and evidenced by the confirmation of delivery rendered by the courier service, or shall be delivered in hand and a receipt provided therefor. Minor modifications to the Work Plan and notice of updating or clarifying any of the Exhibits or Agreement referenced guidance documents shall be communicated in writing sent by email,U.S. Postal Service via first class mail or hand delivered. Any notice or other TCEQ SFG Agreement. Contract No.582-4-64434 Page 5 June 19,2003 written communication shall be considered delivered upon receipt, or in the case of communications sent by first class mail, five days from the date of the communication. TCEQ SFG Agreement. Contract No.582-4-64434 Page 6 June 19,2003 9.8 ADDRESSES FOR NOTICE: TCEQ Local Program Contract Manager: PERFORMING PARTY REPRESENTATIVE: Printed name: Tragi),Callen, MC 174 Printed Name: Brian Roemer Field Operations Division Title: Director of Environmental Management Texas Commission on Environmental Quality P. 0. Box 13087, Capitol Station (T.C. Michaels,Project Manager) Austin,Texas 78711-3087 (PERFORMING PARTY Representative) TCEQ Local Program Project Manager: Air Quality Program Department of Environmental Management Printed name: Rill Main, MC 174 5000 MLK Freeway Fort Worth,Texas 76119 Field Operations Division Texas Commission on Environmental Quality P. 0.Box 13087, Capitol Station Austin,Texas 78711-3087 TCEQ Project Field Representative: Printed Name: Frank Fgpinn Title: RPo nnal nirertor Texas Commission on Environmental Quality Dallas/Fort Worth Regional Office 2301 Gravel Dr. Fort Worth, TX 76118-6951 Email: fespino@tceq.state.tx.us Phone: (817) 588-5800 Fax(Administration): (817) 588-5704 CONTINUED ON NEXT PAGE TCEQ SFG Agreement. Contract No.582-4-64434 Page 7 June 19,2903 IN WITNESS WHEREOF, TCEQ and PERFORIv11NG PARTY have executed this Agreement in multiple copies, each of which is an original. This Agreement will be effective on September 1, 2003,which is the Effective Date of the Agreement. Texas Commission on Environmental Quality PERFORMING PARTY: By By r Signatu LAdL Signature: Printed Name: Glenn W Chankle Printed Name: Libby Watcnn Title: Terni i Exenntive.DirPntnr Title: Accictant Cit7 Manager Date: Date: Z APPROVED AS TO FORINT: By ti Signature: ptw Chris R. Printed Name: Title: Accictant Crib AttnrnP,g Date: i•d(- ATTEST: -ATTEST: By Signature: Printed Name: C41nrir ('..q Tq 0 r Title: Date: I d a 1 1 J tl1 `�J��Y7C' Y�✓� TCEQ SFG Agreement. Contract No.582-4-64434 Page 8 June 19,2003 SCOPE OF WORK SECTION The PERFORMING PARTY shall perform the following tasks by the deadlines indicated in this Scope of Work Section of this Agreement. Only work related to tasks listed in Exhibit A-21 for which the funding level is listed as greater than zero are subject to the requirements of the Scope of Work Section of this Agreement. 1. Grants The PERFORMING PARTY shall complete all the Work described in this Scope of Work and fully comply with all requirements of the current Appropriations Act(Rider 5) from which it receives funds during the term of this Agreement. 2. Administrative Regulations 2.1 Changes to Exhibits. The TCEQ may update, add new, or remove any or all of the exhibits referred to in this Agreement as either a minor or major amendment to this agreement depending upon the nature of the change. 2.2 Changes to Guidance Documents. The TCEQ may update, add new, or remove any or all of the guidance documents referred to in this Agreement. The TCEQ shall promptly notify the PERFORMING PARTY in writing of any changes to the guidance documents, and will attach a copy of the updated documents, except for guidance manuals available only electronically. In the case of guidance available only electronically, the communication from the TCEQ to the PERFORMING PARTY will include an electronic address of the electronic document. The PERFORMING PARTY shall implement updated editions of any such documents within the time frames specified within each of the documents or within the communication describing the document change or within thirty days of receipt,whichever comes first. If the PERFORMING PARTY does not agree to comply with updated editions of these documents, the PERFORMING PARTY shall have the option of turning down particular tasks as task is defined by this Scope of Work which require use of these documents. If the PERFORMING PARTY turns down all or part of a task, it will not receive any payment for that task. 2.3 Fiscal Analysis of Fixed Payment. Within thirty(30) days of the beginning of each fiscal year of this Agreement term, the PERFORMING PARTY shall submit to the TCEQ its current Fiscal Analysis Package(Form B-5). The analysis shall include the following: 2.3.1 An analysis of funding expenditures shall be subnutted on Foran B-5, through completion of the Table of Estimated Funding, the Budget Information Work Sheet: Sections A-E,and the Staffing List Information Work Sheet. 2.3.2 The PERFORMING PARTY must demonstrate how it will provide matching funds for its share of the State Compliance Agreement funds as required by Article 3, Agreement Amount,paragraph 3.1 of this Agreement. 2.4 Requests for Payment. On a quarterly basis from the beginning of the Agreement Term,the PERFORMING PARTY shall submit requests for payment to the TCEQ Local Program Contract Manager with a copy to the Local Program Field Project Representative in accordance with Article 7, Payments to Performing Party of the General Conditions of this TCEQ State Funded Grant Agreement. 2.5 Reserved. 2.6 Financial Status Report. By December 1,2004, the PERFORMING PARTY shall submit a final Financial Status Report(FSR) (Form B-3)for this Agreement for fiscal year 2004. By December 1, TCEQ SFG Agreement. Contract No.582-4-64434 Page 9 June 19,2003 2005, the PERFORMING PARTY shall submit a final Financial Status Report(FSR) (Form B-3) for this Agreement for fiscal year 2005. With each FSR, the PERFORMING PARTY shall submit a list of property purchased wholly or partially with funds from this Agreement and having a unit acquisition cost of$5000 or more. The FSR shall satisfy state financial reporting requirements for this Agreement. The requirements of this section shall survive the termination of this Agreement. 2.7 A copy of the annual independent financial audit required by the Uniform Grant Management Standards shall be provided by the PERFORMING PARTY to the TCEQ Contract Manager within nine(9)months of the end of the PERFORMING PARTY's fiscal year for each fiscal year of the contract period. 2.8 The PERFORMING PARTY shall implement and maintain internal quality control procedures to ensure completeness and accuracy of all Agreement deliverables. 2.9 Annual Work Plan Development. Work Plans shall be developed and agreements shall be reached on the Work Plan through either a major or minor amendment to the Agreement by August 1, 2004 for fiscal year 2005. The developed Work Plan shall be comprised of work consistent with the direction and intent of the Compliance Monitoring Strategy for the Air or Stage H programs. 3 Performance Evaluations of PERFORNIING PARTY Consistent with Article 11 of the General Provisions of this Agreement(related to Standards for Performing PARTY'S PERFORMANCE) the TCEQ will make evaluations of PERFORMING PARTY'S work. from time to time. 3.1 Ongoing work product evaluations. The TCEQ will make evaluations of PERFORMING PARTY'S work in an ongoing manner throughout the Agreement term. Evaluations will be conducted of PERFORMING PARTY'S work product utilizing standardized procedures and will typically be conducted by one or more persons designated with that task by the TCEQ project field representative. At least two of the ongoing evaluations shall be conducted in conjunction with oversight investigations. An oversight investigation may be either a joint or follow-up investigation. A joint investigation is defined as an investigation in which a TCEQ representative accompanies the PERFORMING PARTY during an investigation for the primary purpose of PERFORMING PARTY program oversight. A follow-up investigation is an investigation conducted by a TCEQ representative for the primary purpose of PERFORMING PARTY program oversight at a site where the PERFORMING PARTY had recently completed an investigation. The TCEQ will provide written assessments of each work product evaluated, including oversight investigation results. Written work product evaluations will be provided to the PERFORMING PARTY'S representative responsible for the day to day implementation of the program by the 7'working day of each month for work product evaluations conducted in the preceding month,or at another mutually agreed upon time during the month. 3.2 Periodic program evaluation meetings. The intention of periodic program evaluations is to ensure ongoing good program effectiveness. Evaluations of the PERFORMING PARTY are based on both individual work product evaluations and trends identified through work product evaluations as well as performance under the various activities required under the Agreement. Program evaluation meetings will be held at least quarterly during the course of this Agreement term. The meetings will include at least the TCEQ Project Field Representative or his designee, the TCEQ Air and Waste Section Managers and the PERFORMING PARTY'S representative responsible for day to day program oversight. Standing topics for each meeting should include at least the following topics: updates on progress made on the work plan, updates on program implementation issues, work plan development for future years, progress made in the development and implementation of the Investigator Professional Development Program, discussions on progress implementing corrective action plans, if any, and discussions related to TCEQ SFG Agreement. Contract No.582-4-64434 Page 10 June 19,2003 the various work product evaluations conducted by the TCEQ. If the TCEQ work product evaluations conducted since the previous quarterly meetings result in the TCEQ identifying a trend toward unsatisfactory performance , the discussions will include the area of concern. If TCEQ work product evaluations result in a finding of exemplary performance or a trend towards excellence in program implementation, the TCEQ will discuss those with the PERFORMING PARTY. The TCEQ Field Representative designate will document the meetings and will provide meeting minutes to the PERFORMING PARTY'S representative within three calendar weeks of the meeting. 3.3 Unsatisfactory Performance. If after discussions with the PERFORMING PARTY during the quarterly program evaluation meeting, the TCEQ Project Field Representative determines that a program structural or procedural problem is likely at the root of several individual work product deficiencies, then the TCEQ Project Field Representative will document this issue and notify the PERFORMING PARTY in writing of the suspected program deficiency within 30 days of documentation of the deficiencies. The PERFORMING PARTY will provide a written assessment of the situation to the TCEQ within 30 days of receiving the TCEQ notification. The Performing Party will provide either an explanation of why no program deficiency should be found or a corrective action plan where one is warranted. Any corrective action plan shall include a statement of the problem being addressed by the corrective action plan, the identification of measures implemented to correct the specific problems identified,program structural or procedural measures that have been or will be taken to preclude similar problems from recurring, a time line for implementation of such measures,and milestones and measures to be used to demonstrate improvement. The plan does not require approval by the TCEQ and should be implemented immediately by the PERFORMING PARTY. 3.4 Correction to unsatisfactory performance. The efficacy of any plans submitted under paragraph 3.3 of this section will be assessed through subsequent periodic work product evaluations and demonstrations made by the PERFORMING PARTY concerning progress made to correct the underlying cause of the unsatisfactory performance. Demonstrations concerning corrective action plans shall be provided to the TCEQ by the PERFORMING PARTY during the periodic program evaluation meetings unless the TCEQ specifically agrees to an alternative schedule or venue of demonstrations. 3.5 Sanctions for unsatisfactory performance. The TCEQ may avail itself of any remedies identified in Article 11 of the General Conditions of this Agreement after the TCEQ makes a written finding to the PERFORMING PARTY of unsatisfactory performance. 3.6 Performance Evaluation addressing performance for work conducted in Fiscal Year 2003. 3.6.1 If the TCEQ identifies deficiencies in the air program compliance and enforcement activities during the Fiscal Year 2003 Annual Performance Evaluation required by a previous Agreement between the TCEQ and the PERFORMING PARTY,the PERFORMING PARTY shall, within 90 days after receipt of TCEQ comments or as recommended by the TCEQ, correct any similar deficiencies in the work performed under that Agreement and report to the TCEQ any deficiencies that cannot be corrected within the 90 days. 3.7 Annual Performance Evaluation addressing work conducted covering work conducted in each fiscal year of this agreement. 3.7.1 By the first day of August of each fiscal year covered in this agreement , the TCEQ will provide an Annual Performance Evaluation Questionnaire to be completed by the PERFORMING PARTY. The response to the Questionnaire will be used as the basis for the on-site evaluation of air program compliance and enforcement activities which have occurred during the prior fiscal year. 3.7.2 By the 156'day of September following the receipt of the Questionnaire identified in paragraph 3.7.1 above, the TCEQ will provide a schedule for the Annual Performance Evaluation. TCEQ SFG Agreement. Contract No.582-4-64434 Page 11 June 19,2003 3.7.3 By the first day of October following the receipt of the Questionnaire identified in paragraph 3.7.1 above, the PERFORMING PARTY shall provide a written response to the Annual Performance Evaluation Questionnaire to the TCEQ. 3.7.4 By the first day of December following the receipt of the Questionnaire identified in paragraph 3.7.1 above, the TCEQ will complete the on-site evaluation of the air program compliance and enforcement activities. The on-site review will include discussion of preliminary findings and recommendations. 3.7.5 Within forty-five (45) days of completing the on-site Annual Performance Evaluation the TCEQ will provide a written report containing the findings of the on-site Annual Performance Evaluation to the PERFORMING PARTY. 3.7.6 Within forty-five (45) days of receipt of the Annual Performance Evaluation Report covering performance of PERFORMING PARTY against the Fiscal Year 2003 Agreement, the PERFORMING PARTY shall provide information to the TCEQ in writing concerning action(s) that will be taken or have been taken to correct any deficiencies noted in the Annual Performance Evaluation report. This response will include a schedule to bring any deficiencies in the air program activities up to TCEQ standards and will identify resources to accomplish necessary corrections. 3.7.7 Within ninety(90) days after receipt of the Annual Performance Evaluation report provided by the TCEQ the PERFORMING PARTY shall correct deficiencies and report to the TCEQ any deficiencies that cannot be corrected within the 90 days. 4 General Requirements Applicable to All Affected Work Activities. The following requirements apply to each Work Plan task(activity) that is listed in paragraphs 5 through 22 of Scope of Work Section. 4.1 Payment. The PERFORMING PARTY shall receive the dollar amount specified and agreed upon in this Agreement for each completed Work Plan task listed in paragraphs 5 through 22 of this part of this Agreement. 4.2 Responsibility of PERFORMING PARTY: A complete work task under this Agreement shall include all of the general requirements applicable to all affected work tasks types as listed in this paragraph 4 and all the requirements specific for each work task type listed paragraphs 5 through 22 of this part. In order to receive the compensation set out in Article 5 of this Agreement, incorporated herein as the"Bases For Calculating Payment," the PERFORMING PARTY must fulfill all of the following subsections, including investigation and enforcement or task handling, direct data entry, and training for each of the relevant work types listed in paragraphs 5 through 22 of Statement of Services of this Agreement: 4.2.1 Program: PERFORMING PARTY shall implement and conduct a program for each task type identified in relevant paragraphs of Part A ,paragraphs 5 through 22 of the Scope of Work Section of this Agreement and conduct the relevant activities related to those paragraphs. In the process of conducting work under this Agreement, the PERFORMING PARTY shall comply with the requirements of the most recent applicable version of the following guidance documents and exhibits Guidance Documents: • Air Program Investigator's Manual dated February 9, 1998. • Open Records Decision No. 391,dated July 26, 1983 TCEQ SFG Agreement. Contract No.582-4-64434 Page 12 June 19,2003 • Criteria for Initiation of Formal Enforcement Action for Air,Water,and Waste Violations, Enforcement Initiation Criteria, FODSOP Appendix 3, rev 8.0. Available electronically at: http:/ihome.tceq.state.tx.us/intemal/enforcement/fodforms/fod_sop/appfo_03.wpd • Enforcement Standard Operating Procedures, Enforcement SOP,rev. May 9, 2003. Available as hard copy and as electronic copy on the T-Net at: http://home.tceq.state.tx.us/cgi-bin/intemal/enforcement/listofapp.pi • Field Operations Division Standard Operating Procedures(FODSOP), rev October 15, 2002. Available as hard copy and as electronic copy on the T-Net at: http://home.t ceq.state.tx.u s/cgi-bin/intemal/en forcemen t/fod forms?page=FOD_SOP • Enforcement Action Referral Instructions,rev May 9,2003 October 8,2002, EnfSop Appendix 3b. Available as hard copy and electronically from the T-Net location: http:/ihome.tceq.state.tx.us/egi-bin/intemal/enforcement/listofapp.pl?sort=title&document title=ear • Exceptions Report Guidance,rev 1.0. Available as hard copy and electronically from the T-Net location: http:/ihome.tceq.state.tx.us/intemal/enforcement/air_inspect/index.htm • CCEDs User Manual. Available via the CCEDS application or electronically from the T-Net location: http://home.tceq.state.tx.us/internal/enforeement/cceds/ceedsug.html • TCEQ Compliance Monitoring Strategy. Available as hard copy and electronically from the T-Net Location: http:/ihome.tceq.state.tx.us/cgi-bin/intemal/enforcement/fodfornis?page=FOD_SOP Exhibits: Exhibit A-21: Local Air Program Work Plan Exhibit A-22: Work Plan Pricing Matrix 4.2.2 Conduct specified number and type of work plan activities consistent with the Compliance Monitoring Strategy guidance document for the TCEQ. The PERFORMING PARTY shall plan for and conduct the number and type of work plan activities as identified in Exhibit A-21 for the respective local program. The parties to this Agreement may provide for fewer investigations or activities,or a smaller percentage of investigations or activities, or investigations or activities of different types by making a Minor Change or Written Amendment, as appropriate, to the work plan. When developing the work plan(Exhibit A-21)the PERFORMING PARTY shall select the number and type of investigations consistent with the Compliance Monitoring Strategy of the TCEQ effecting maximum benefit for air pollution control consistent with TCEQ objectives. Planned investigations conducted at the same site in successive fiscal years may only be scheduled for such repeat planned investigations where the Compliance Monitoring Strategy requires such or after prior approval by the TCEQ. 4.2.3 Maintain Lists of Sources. The Performing party shall develop and maintain a census of sources subject to recurring planned investigations resulting from applying the Compliance Monitoring Strategy for the Air and Waste Programs. For air pollution control subject sources, the census shall include those sources which meet the definition of`Sources of Interest to the EPA' as defined in the General Conditions of this Agreement as well as those sources subject to a 100% inspection commitment annually,such as sources subject to Reid Vapor Pressure or Oxygenate sampling requirements. For sources subject to Stage 11, the census shall include those sources subject to that program. The census of sources shall be utilized when developing and implementing Work Plans, and therefore should be maintained as the fiscal year progresses,but TCEQ SFG Agreement. Contract No.582-4-64434 Page 13 June 19,2003 must be as accurate as possible prior to Work Plan development in any given fiscal year. The TCEQ has adopted the Central Registry database as the primary repository of information about regulated entities and it is the intent to use Central Registry for that purpose. Therefore, the PERFORMING PARTY and the TCEQ should actively work towards utilization of that database repository to store the list of sources. 4.2.4 Reserved. 4.2.5 Enforcement: 4.2.5.1 The PERFORMING PARTY shall issue notices of violations and initiate appropriate enforcement actions on all violations detected during any Work Plan related investigation for which the performing party is responsible, even when violations are discovered at the site that may be unrelated to the primary purpose of the investigation being conducted. 4.2.5.2 The PERFORMING PARTY shall refer cases requiring consideration for enforcement action to the TCEQ within sixty(60)days from the last day of the investigation in which the violation was detected unless an otherwise specifically identified deadline is established in the exhibits or Agreement documents for the enforcement action and related investigation type. 4.2.5.3 In cases which present or may present an imminent and substantial danger to the environment or to the health or welfare of persons, the PERFORMING PARTY may seek enforcement through municipal agencies or take enforcement action when referral to the TCEQ will result in unacceptable delay. In the event that the PERFORMING PARTY decides to enforce using this subsection, oral notice must be given immediately to the TCEQ regional office with written notice following within five working days of any oral notification. 4.2.6 Reserved. 4.2.7 Database Usage. Unless otherwise specifically directed, all investigation and enforcement tasks performed under this Agreement shall be documented in the Comprehensive Compliance and Enforcement Database(CCEDS)in a manner consistent with the various guidance documents created for that purpose related to investigations, enforcement, CCEDS,FODSOP, and the Enforcement SOP. In addition, all incidents reported to the PERFORMING PARTY shall be documented in CCEDS in the manner required by the investigation protocols related to the incident type and by the CCEDS manual. Data entry of all required enforcement and investigation data into CCEDS shall be an ongoing requirement through out the term of this Agreement. 4.2.7.1 Mutual Obligations of Parties related to CCEDS: 4.2.7.1.1 TCEQ Support: • The TCEQ shall provide phone support(512-239-6231), as outlined in the CCEDs User Manual during normal business hours to guide PERFORMING PARTY'S technical personnel in trouble-shooting network and application issues. • The TCEQ shall provide the appropriate level of technical support, including but not limited to, on-site support to facilitate the timely correction of technical problems, to facilitate the PERFORMING PARTY in the completion of data entry and reporting obligations. • TCEQ is responsible for the installation, termination and maintenance of the data circuit from TCEQ to the Point of Presence at the Local Programs site. TCEQ is responsible for terminating the circuit into the local router. Local router is owned, operated and maintained by TCEQ. • The TCEQ shall configure all TCEQ network software to TCEQ standards. TCEQ SFG Agreement. Contract No.5824-64434 Page 14 .Tune 19,2003 • The TCEQ shall provide information on the TCEQ WAN and applications to the PERFORMING PARTY as needed. 4.2.7.1.2 PERFORMING PARTY support: • The PERFORMING PARTY is responsible for extension of connectivity from the local router to an ethernet switch and distribution on a local area network to each workstation. • The PERFORMING PARTY shall configure all network hardware and software on the segment of their network connected to the TCEQ WAN in order to maintain compatibility with TCEQ standards and to assure that TCEQ applications can properly operate on the network segment. • The PERFORMING PARTY network segment connected to the TCEQ WAN will be a separate and distinct network with no connections to other LAN's, WAN's or data circuits. • The PERFORMING PARTY shall provide a primary automation point of contact, or his/her successor,who shall be responsible for security of the network and equipment used by PERFORMING PARTY staff,responding to TCEQ inquiries, requests for network assistance and communicating automation questions and/or problems to the TCEQ WAN manager or TCEQ Automation staff. • The PERFORMING PARTY shall allow TCEQ technical staff physical and electronic, and logical network access for application support and security monitoring. • The PERFORMING PARTY shall obtain approval from the TCEQ Field LAN Support Supervisor(Becky Schiffel,bschiffe@tceq.state.tx.us or at(512) 239-6034) prior to making network segment configuration changes that may negatively impact access to the TCEQ WAN or the TCEQ applications. 4.2.7.2 Reserved. 4.2.7.3 Quality and Timeliness: Timely, accurate, and complete data entry related to all work plan items is essential to completion of the work, and must be accomplished in accordance with the Agreement and relevant guidance documents. The data entry and/or submission of reports delayed by the PERFORMING PARTY due to the unavailability of TCEQ data systems when the unavailability is due to the TCEQ systems shall not be deemed untimely and/or deficient. 4.2.7.4 Database Training The PERFORMING PARTY shall attend TCEQ-sponsored database application training on an as scheduled basis. It shall be the responsibility of the PERFORMING PARTY to ensure that its staff is adequately trained and qualified in order to perform designated tasks. 4.2.8 Monthly Reporting. The PERFORMING PARTY shall each month provide the appropriate TCEQ Local Program Regional Liaison with an original copy of each approved investigation report or enforcement referral package as well as a report on its accomplishment of each of the tasks included in the Statement of Services Section of this Agreement that is included in Exhibit A-21, the Work Plan for the PERFORMING PARTY. The PERFORMING PARTY shall provide this documentation within seven(7) working days after the end of each calendar month of the fiscal years for which this Agreement is in effect. Where the information necessary to complete the monthly Work Plan task progress reports is required to reside in CCEDS or other TCEQ data systems, the reports may be generated from that data. Where possible, crystal reports TCEQ SFG Agreement. Contract No.582-4-64434 Page 15 June 19,2003 will be the preferred mechanism of generating the reports and as they are developed, will be an acceptable mechanism of providing the reports. The monthly reporting must contain at least the following elements: 4.2.8.1 A summary report of progress against the Work Plan specifying the number and type of Work Plan activities approved for the month, and a year-to-date listing of progress for each work plan type listed in the Scope of Work Section of this Agreement showing both activities performed and activities completed and approved. The listing of activities approved for the month shall include sources investigated by name,regulated entity number of identification, and investigation type code. 4.2.8.2 A listing of any work plan revisions detailing changes that have been made in the work plan for the month and indicating the approval date and approving parties of each change. Properly executed minor or major amendments may suffice for this section of the report. 4.2.8.3 A listing by type of enforcement initiated (Verbal Notice, NOV or NOES) during the month. For each activity initiated, indicate the type of enforcement activity initiated,the rules violated, and the resolution of each enforcement action initiated. Include in the listing any requests (and response to each request)to either initiate enforcement or forego enforcement allowed under the enforcement exception request process as listed in Exhibit A-5: Criteria for Initiation of Formal Enforcement Action for Air, Water, and Waste Violations, Enforcement Initiation Criteria,FODSOP Appendix 3. 4.2.8.4 A listing of each work plan task for which was approved more than thirty (30)days after the required deadline and an explanation of why that delay occurred, and what has been implemented to minimize recurrence of similar delays. 4.2.8.5 Investigation Reports or activity results: The PERFORMING PARTY shall submit an original hard copy of each investigation report and any associated or referenced attachments approved during the month. Enforcement referral packages (including any work product referenced attachments) approved during the month will be forwarded to the TCEQ in accordance with paragraph 4.2.5 of this section. 4.2.8.6 The monthly report will also include additional reporting as may be listed in each of Paragraphs 5 through 22 of the Scope of Work section of this Agreement. 4.2.8.7 Exceptions and Deadlines. The PERFORMING PARTY will include a section in the monthly report detailing each of the following: 4.2.8.7.1 the identification of each enforcement action that was untimely and an explanation for the untimeliness, including the identification of any violation situation indicated to include a High Priority Violation that has not or will likely not meet the timeliness requirements. 4.2.8.7.2 the identification of any enforcement exceptions requests made pursuant to Exhibit A-12. 4.2.8.8 A listing of Stage II facilities which were newly identified or which were identified as closed or no longer in business shall be created and updated and maintained monthly by the PERFORMING PARTY. The listing shall include the total number identified during the calendar month and the cumulative number identified since the beginning of the fiscal year covered by this Agreement. 4.2.8.9 Investigator Professional Program Development Reporting. The PERFORMING PARTY shall submit written reports monthly to the TCEQ describing actions taken in the development and implementation of the Investigator Professional Development Program to date and a projection of actions to be taken in the coming month. 4.2.9 Training and qualification for investigators must include but is not limited to: 4.2.9.1 Annual TCEQ Air Investigators Training or Annual PST Stage II training,as appropriate. 4.2.9.2 Visible Emissions Evaluator's Certification (required for investigators who will be making opacity readings using EPA Method 9). 4.2.9.3 Training related to TCEQ database use when available. TCEQ SFG Agreement. Contract No.582-4-64434 Page 16 June 19,2003 4.2.9.4 Training and certification of Emissions Evaluators performing stack test pretest meetings, observations and report reviews. 4.2.9.5 It shall be the responsibility of the PERFORMING PARTY to identify and obtain any safety training necessary. 4.2.10 Managers or manager-appointed representatives for the PERFORMING PARTY shall attend TCEQ-sponsored Local Program Managers' Meetings in Austin, Texas, on an as-scheduled basis. 5. Requirements specific for the following Investigation and Enforcement programs: ANBI: CCI Investigations at Sources of Interest to the EPA. 5.1 A complete task under this section shall include all of the general requirements of paragraph 4 of the Scope of Work Section of this Agreement and additionally: 5.1.1 Work Specific Guidance: • Comprehensive Compliance Inspection Protocol, rev 2.0. Available on T-net Air Investigators Page at the following location: http://home.tceq.state.tx.us/intemaUenforeement/air_inspect/i ndex.htm • Exceptions Report Guidance,rev 1.0. Available as hard copy and electronically from the T-Net location: http://home.tceq.state.tx.us/intemaUenforcement/air inspect/index.htm 5.1.2 List of Sources. The PERFORMING PARTY and the TCEQ agree that the List of Sources of Interest to the EPA contained in Table 3 of Exhibit A-21 for the appropriate local program constitutes the list of sources subject to this investigation and enforcement program. The PERFORMING PARTY and the TCEQ agree that those sources marked as scheduled for a CCI in that same Table 3 will constitute the sources to be investigated for the fiscal year for this program to determine compliance with all applicable rules and regulations. Note that the specific list of sources to be investigated in any given year is subject to the guidance document depicting the compliance monitoring strategy for the air and waste programs. No additional compensation will be paid for any ANBI Investigations at Sources of Interest to the EPA which are not included in the list unless the list is modified by mutual agreement of both parties. 5.1.3. Update the List of Sources of Interest to the EPA. By May 1 S` of each fiscal year of this Agreement, the PERFORMING PARTY must provide an updated list of Sources of Interest to the EPA to the TCEQ. Such a list shall identify any changes to existing sources on the list in Table 3 of Exhibit A-21, and propose any new sources that should be added to that list along with an explanation of why such changes should be made. 6. Requirements Specific for the following Investigation and Enforcement programs: NMNC: Non-Major Non-Checklisted Source CCI Investigations NMCL: Non-Major Checklisted Source CCI Investigations 6.1 A complete task under this section shall include all of the general requirements of paragraph 4 of the Scope of Work Section of this Agreement and additionally: 6.1.1 Work Specific Guidance: • Air Program Investigator's Manual, FODSOP Appendix 29, specifically related to checklisted investigations for NMCL type investigations • Comprehensive Compliance Inspection Protocol, rev 2.0. Available on T-net Air Investigators Page at the following location: TCEQ SFG Agreement. Contract No.582-4-64434 Page 17 June 19,2003 http://home.tceq.state.tx.us/intemal/enforcement/air_inspect/index.hrm • Exceptions Report Guidance, rev 1.0. Available as hard copy and electronically from the T-Net location: http:/Ihome.tceq.state.tx.us/intemaUenforcement/air_inspect/index.htm 7. Requirements Specific for the following Citizen Complaint,including citizen complaints related to Stage II vapor recovery Investigation and Enforcement programs: COMPLAINT: Complaint Investigations 7.1 A complete task under this section shall include all of the general requirements of paragraph 4 of the Scope of Work Section of this Agreement and additionally: 7.1.1 Work Specific Guidance: • Air Program Investigator's Manual dated February 9, 1998, specifically related to complaint investigations. • Guidance Manual for Field Operations Division Investigation of Complaints, Complaints Manual rev 1.0, 8/7/00,FODSOP Appendix 9. • Stage II Vapor Recovery Policy and Procedure Manual,FODSOP Appendix 29 Available as hard copy and individual sections on the T-Net under FODSOP at the following location: http://home.tceq.state.tx.us/cgi-bin/intemaUenforcement/fodfomis?page=FOD_SOP 7.1.2 List of Sources. The PERFORMING PARTY shall respond to all citizen air pollution complaints within its jurisdiction received or referred to it in a time frame at least as quickly as that required in FODSOP, Section 2.1.3.1. for the prioritization of incidents. Any investigation performed which is not required by the Exhibits listed in this section or policy shall be considered outside the scope of this Agreement,but if a violation is detected, it may be referred to TCEQ for consideration of enforcement action,where appropriate. 7.1.3 Disclosure of Confidential Information. The PERFORMING PARTY shall protect from disclosure information regarding the identity of a complainant to the extent allowed by the Texas Public Information Act, Govt. Code Chapter 552. (See also Guidance Document, Attorney General of Texas Open Records Decision No. 391 (1983)). In the event that information which tends to identify a complainant is requested pursuant to the Texas Public Information Act,PERFORMING PARTY shall seek to protect that information through a request for opinion of the Attorney General's Office. The PERFORMING PARTY shall also maintain an information file about each complaint filed with the PERFORMING PARTY. 7.1.4 Special Reporting. 7.1.4.1 In accordance with Section 5.177 of the Water Code, the PERFORMING PARTY shall provide to complainants a quarterly status report for any unresolved written complaint received from within its jurisdiction. 7.1.4.2 The PERFORMING PARTY shall make available to the TCEQ, monthly and upon request, information regarding the investigation and handling of Stage II vapor recovery related complaints. 7.1.4.3 The PERFORMING PARTY shall include both the number of citizen air program and Stage II program complaints received in the month covered by the report and cumulative for the year. 7.1.5 Coordination with TCEQ. The PERFORMING PARTY shall immediately coordinate with the appropriate TCEQ regional office and, as necessary, the Office of Compliance&Enforcement, Enforcement Division, on action to respond to any complaints that are substantial in terms of TCEQ SFG Agreement. Contract No.582-4-64434 Page 18 June 19,2003 concentration, duration, or potential health impacts. 7.1.6 Violations Detected. The PERFORMING PARTY shall issue a notice of violation and initiate the enforcement action on all cases of nuisance, confirmed complaints, or any other violations of state air pollution laws or rules detected during a complaint investigation, as required by the most recent version of each of the previously cited exhibits in SCOPE OF WORK SECTION , Item 4.2.1. 7.1.7 Information Access. The PERFORMING PARTY shall make available to the TCEQ, upon request, information regarding the investigation and handling of complaints. Available information shall include the number of citizen air pollution complaints investigated by the PERFORMING PARTY each month. 7.1.8 Timeliness of Data Entry. The PERFORMING PARTY shall enter all complaints information into CCEDS as soon as practical after receiving the complaint. 7.1.9 Training. Complaint Coordinator Training,when provided by the TCEQ is required for appropriate staff and a manager,as changes may affect handling procedures. 8. Requirements Specific for the following Investigation and Enforcement programs: PMSI and POSI: Permit Site Review Investigations(Stationary and Portable permits respectively) PMPR: Permit Provisions Review Investigations 8.1 A complete task under this section shall include all of the general requirements of paragraph 4 of the Scope of Work Section of this Agreement and additionally: 8.1.1 Work Specific Guidance: • Air Program Investigator's Manual dated February 9, 1998. • 30 TAC, Chapter 116, Investigation Protocol,rev 7115100 Available as hard copy or electronically from the T-Net location: http://home.tceq.state.tx.us/intemal/enforcement/air_inspect/index.htm 8.1.2 Special Reporting. In addition to the data entry requirements listed in paragraph 4 of this part, response to these investigations will also include reporting to the Air Permits program in the manner described in the referenced guidance documents. 9. Requirements specific for the following New Source Review Permit (NSR) Compliance Investigation and Enforcement programs: NSR1: On-Site NSR Level 1 review of all non-flexible permit NSR authorizations at a site . NSR2: On-Site NSR Level 2 permits review limited to flexible permits. NSR3: On-Site NSR Level 3 In-depth investigation of preconstruction authorization, determining VOC emissions from Organic Process Leaks (OpLeaks) from cooling towers or component leak detection and repair programs 9.1 A complete task under this section shall include all of the general requirements of paragraph 4 of the Scope of Work Section of this Agreement and additionally: 9.1.1 Work Specific Guidance: • Comprehensive Compliance Inspection Protocol,rev 2.0. Available on T-net Air Investigators Page at the following location: http://home.tceq.state.tx.us/internal/enforeement/air_inspect/index.htm • Exceptions Report Guidance,rev 1.0. Available as hard copy and electronically from the T-Net location: http://home.tceq.state.tx.us/intemal/enforcement/air_inspect/index.htm TCEQ SFG Agreement. Contract No.582-4-64434 Page 19 June 19,2003 • OpLeaks Program Investigations Protocol, rev 1.0 Available as hard copy and electronically from the T-Net Location: http://home.tceq.state.tx.us/intemaUenforcement/air_inspect/ind ex.htm 9.1.2 List of Sources. The PERFORMING PARTY and the TCEQ agree that the list of sources contained in Tables 3 and 4 of Exhibit A-21 for the appropriate local program constitutes the list of sources subject to this investigation and enforcement programs. The PERFORMING PARTY and the TCEQ agree that those sources marked as scheduled for a NSR1 or NSR2 of that same Table 3 and for NSR3 investigations,Table 4 of Exhibit A-21, constitute the list of sources to be investigated for the fiscal year for this program. The investigations will be performed in order to determine compliance with all applicable New Source Review rules and regulations with the scope being that described in the investigation protocols. The list of Sources of Interest to the EPA (Table 3) or Table 4 may be revised as a Minor Change upon the agreement of both parties. No additional compensation will be paid for any NSR1,NSR2 or NSR3 investigations conducted at sources not listed on Table 3 or Table 4 unless the list is modified by mutual agreement of both parties. 9.1.3 Special Equipment. It shall be the responsibility of the PERFORMING PARTY to acquire and maintain the special equipment identified in the Special Investigation Training and Equipment Costs table of Exhibit A-21. 10. Requirements Specific for the following Investigation and Enforcement programs: BURN: Investigations related to outdoor burning and burning approval 10.1 A complete task under this section shall include all of the general requirements of paragraph 4 of the Scope of Work Section of this Agreement and additionally: 10.1.1 Work Specific Guidance: • Exceptions Report Guidance, rev 1.0. Available as hard copy and electronically from the T-Net location: http://home.tceq.state.tx.us/intemaUenforcement/air inspect/index.htm • 30 TAC, Chapter 111, Investigation Protocol, rev 1.0 10.1.2 Response to Events. The PERFORMING PARTY shall conduct Investigations related to outdoor burning within its jurisdiction received or referred to it as expeditiously as possible. 11. Requirements Specific for the following Enforcement Follow-up Investigation and Enforcement programs: FI/RR: Enforcement On-Site Followup Investigations(FI) or Enforcement Followup Record Review Investigation (RR) ENF FI: Agreed Order followup Investigations 11.1 A complete task under this section shall include all of the general requirements of paragraph 4 of the Scope of Work Section of this Agreement and additionally: 11.1.1 Work Specific Guidance: • Exceptions Report Guidance, rev 1.0. Available as hard copy and electronically from the T-Net location: http://home.tceq.state.tx.us/intemallenforcement/air inspect/index.htm 11.1.2 Response to Events. The PERFORMING PARTY shall conduct FURR and ENF FI Investigations within its jurisdiction received or referred to it in a timely manner. TCEQ SFG Agreement. Contract No.552-4-64434 Page 20 June 19,2003 12. Requirements Specific for the following Mobile Source Related Investigation and Enforcement programs: BD04: Investigation of vehicle emissions controls at used car lots BD14: Fuel Oxygenate Determination Investigations BD05-RVP: Determination of Gasoline Reid Vapor Pressure Investigations 12.1 A complete task under this section shall include all of the general requirements of paragraph 4 of the Scope of Work Section of this Agreement and additionally: 12.1.1 Work Specific Guidance: • Air Program Investigator's Manual dated February 9, 1998 addressing used car lot investigations. • Oxygenate and Reid Vapor Pressure Test Methods 12.1.2 List of Sources. The PERFORMING PARTY and the TCEQ agree that the number of investigations identified in Table 1 of Exhibit A-21 related to these investigations types for the local program shall constitute the initial work plan for this program. The Work Plan may be revised periodically as a Minor Change upon agreement of both parties. No additional compensation will be paid for any Used Car Lot, Oxygenate or Reid Vapor Pressure Investigations performed beyond the number identified in the Work Plan, unless the work plan is modified by mutual agreement of both parties. 13. Requirements Specific for the following Upset or Maintenance Event Investigation and Enforcement programs: UML1: Level 1 Upset/Maintenance Investigation of a Single Event(or related events) requiring immediate on-site response. UML2: Level 2 Upset/Maintenance Investigations covering all u/m activity at a site for the past year. IMAI or]UPS: Level 3 Upset/Maintenance Investigation of a Complex Single Event(or related events) not requiring immediate on-site response. U`XL4: Level 4 Upset/Maintenance Investigation of a Non-Complex Single Event(or related events)not requiring immediate on-site response. RCAPP/RCAP: Review of a Corrective Action Plan Proposal(RCAPP) as a response to a finding of an excessive emissions event determination by the Executive Director of the TCEQ or an assessment of a regulated entity against the requirements of an approved Corrective Action Plan (RCAP). 13.1 A complete task under this section shall include all of the general requirements of paragraph 4 of the Scope of Work Section of this Agreement and additionally: 13.1.1 Work Specific Guidance: • Air Program Investigator's Manual dated February 9, 1998. Available as hard copy only • Upset/Maintenance Investigation Protocol, rev October 18, 2002. Available as hard copy only • Exceptions Report Guidance, rev 1.0. Available as hard copy and electronically from the T-Net location: http://home.iceq.state.tx.us/intemal/enforcement/air_inspect/index.htin TCEQ SFG Agreement. Contract No.582-4-64434 Page 21 June 19,2003 13.1.2 UML2Investigations. 13.1.2.1 Lists of Sources. The PERFORMING PARTY and the TCEQ agree that the list of Sources of Interest to the EPA contained in Table 3 of Exhibit A-21 for the appropriate local program constitutes the list of sources subject to this investigation and enforcement program. The Performing Party and the TCEQ agree that those sources marked as scheduled for a UML2 in that same Table 3 will constitute the sources to be investigated for the fiscal year for this program. 13.1.2.2 Scope of Investigation. A complete Level 2 Upset/Maintenance Investigation at a given site shall include the review of all Upset/Maintenance activities related to that site for at least the 12 months preceding the investigation. 13.1.3 Upset/Maintenance Level 1, 3 or (UML1, IMA1/IUPS and UML4, respectively) Investigations. 13.1.3.1 Lists of Sources. The PERFORMING PARTY shall respond to all notifications for Level 1,3 and 4 Upset/Maintenance Investigations within its jurisdiction consistent with the requirements outlined in the protocols for these type of investigations. 13.1.3.2 Scope of Investigation. A complete Level 1, 3 or 4 Upset/Maintenance Investigation involves either a single event or may involve several related events that occurred over a finite span of time at a given site. 13.1.3.3 Coordination with TCEQ. The PERFORMING PARTY shall immediately coordinate with the appropriate TCEQ regional office and, as necessary,the Office of Compliance &Enforcement,Enforcement Division,on action to respond to any upset or maintenance events that are substantial in terms of concentration, duration, or potential health impacts, or that meet the criteria of a UML1 investigation described in Exhibit A-10. 13.1.3.4 Violations Detected. The PERFORMING PARTY shall issue a notice of violation and initiate the enforcement action on all cases of nuisance or any other violations of state air pollution laws or rules detected during an upset/maintenance level 1, 3 or 4 investigation, as required by the most recent version of each of the previously cited exhibits in Scope of Work Section,Item 4.2.1. 13.1.3.5 Timeliness of Data Entry. The PERFORMING PARTY shall enter all upset/maintenance information into CCEDS as soon as practical after receiving the notification. 13.1.4 RCAPP/RCAP: Review of a Corrective Action Plan Proposal (RCAPP)as a response to a fording of an excessive emissions event determination by the Executive Director of the TCEQ or an assessment of a regulated entity against the requirements of an approved Corrective Action Plan (RCAF). 13.1.4.1 Scope of Investigation. The scope of the investigations are outlined in the protocol for these investigation types. The TCEQ Executive Director reserves the authority to approve or deny any Corrective Action Plan (CAP) or Permit Request to address excessive emissions events. Therefore, the PERFORMING PARTY may neither approve nor deny CAPS,but rather, they must make a recommendation, in writing, to the TCEQ regional office on approval or denial of such a plan or permitting request. Where this issue arises, the PERFORMING PARTY will work in conjunction with the appropriate TCEQ Air Section Manager or his/her designee for handling CAPs or CAP denials for a timely resolution of the situation. 13.1.5 Training. Upset/Maintenance (Emissions Events) training, when provided by the TCEQ is required for appropriate staff and a manager, as changes may affect handling procedures. 14. Requirements specific for the following Title V Permit Compliance Certification Investigation and Enforcement programs: SPCC: On-Site Permit Compliance Certification Review. OPCC: In-Office Permit Compliance Certification Review. TCEQ SFG Agreement. Contract No.582-4-64434 Page 22 June 19,2003 14.1 A complete task under this section shall include all of the general requirements of paragraph 4 of the Scope of Work Section of this Agreement and additionally: 14.1.1 Work Specific Guidance: • 30 TAC, Chapter 122, Investigation Protocol, rev 7/15/00. Available as hard copy or electronically from the T-Net location: http://home.tceq.state.tx.us/intemal/enforcement/air_inspect/index.htm • Exceptions Report Guidance, rev 1.0. Available as hard copy and electronically from the T-Net location: http://home.tceq.state.tx.us/intemal/enforcement/air_inspect/index.htm 14.1.2 List of Sources. The PERFORMING PARTY and the TCEQ agree that the list of sources contained in Table 3 of Exhibit A-21 for the appropriate local program constitutes the list of sources subject to these investigation and enforcement programs. The PERFORMING PARTY and the TCEQ agree that those sources marked as scheduled for a SPCC or OPCC of that same Table 3 constitute the list of sources to be investigated for the fiscal year for this program. The investigations will be performed in order to determine compliance with all applicable rules and regulations governed by the operating permit which is the subject of the investigation. The list of Sources of Interest to the EPA(Table 3) may be revised as a Minor Change upon the agreement of both parties. No additional compensation will be paid for any SPCC or OPCC investigations conducted at sources not listed on Table 3 or Table 4 unless the list is modified by mutual agreement of both parties. 15. Requirements Specific for the following Generic Compliance Investigation Report Review Investigation and Enforcement programs: I1NES: Investigations related to reviewing reports received from sources subject to the National Emissions Standards for Hazardous Air Pollutants (NESHAPs,40 CFR 61). INSP: Investigations related to reviewing reports received from sources subject to the New Source Performance Standards (HSPS,40 CFR 60). RR07: Investigations related to reviewing reports received from sources subject to 30 TAC 117,related to Nitrogen Oxide requirements. RRGR: Investigations related to reviewing reports received from sources subject to any other air related requirement not otherwise listed specifically in the Work Plan. including, but not limited to 30 TAC 115, related to Control of Volatile Organic Compounds,30 TAC 106,related to Permits by Rule, or 30 TAC 116, related to Permits. 15.1 A complete task under this section shall include all of the general requirements of paragraph 4 of the Scope of Work Section of this Agreement and additionally: 15.1.1 Work Specific Guidance: • Exceptions Report Guidance, rev 1.0. Available as hard copy and electronically from the T-Net location: http://home.tceq.state.tx.us/intemal/enforcement/air_inspect/index.htm 15.1.2 List of Sources. The PERFORMING PARTY and the TCEQ agree that the number of investigations identified in Table 1 of Exhibit A-21 related to these investigations types for the local program shall constitute the initial work plan for this program. The Work Plan may be revised periodically as a Minor Change upon agreement of both parties. No additional compensation will be paid for any On Site Burn Investigations performed beyond the number identified in the Work Plan unless the Work Plan is modified by mutual agreement of both TCEQ SFG Agreement. Contract No.582-4-64434 Page 23 June 19,2003 parties. 15.1.3 Response to Events. The PERFORMING PARTY shall conduct investigations of the listed types within its jurisdiction received or referred to it consistent with the plan of reviewing such reports received as described in the referenced guidance documents. 16. Requirements Specific for the following Stack Testing Investigation and Enforcement programs: PRES: Pre-test meeting investigations. OBPT/OBCC: Observation of Performance Test or CEM Certification test, respectively. RDFT: Review of Stack Test report 16.1 A complete task under this section shall include all of the general requirements of paragraph 4 of the Scope of Work Section of this Agreement and additionally: 16.1.1 Work Specific Guidance: None. 16.1.2 Response to Events. The PERFORMING PARTY shall conduct investigations of the listed types within its jurisdiction received or referred to it as expeditiously as possible. 16.1.3 Training. No work of this type will be performed unless the work is conducted by a person who has successfully completed the Emissions Evaluator Certification test as administered by the TCEQ unless that person is working directly under the guidance of persons specifically designated by the TCEQ. 17. Requirements Specific for the following Stage II Vapor Recovery (and related Stage I) Investigation and Enforcement programs: Stage II System Test Observations Stage II Compliance Evaluation Investigations(CET) Stage II Followup Investigations Stage II Record Review Investigations 17.1 The Stage II Vapor Recovery investigation and enforcement program includes investigation and enforcement with respect to both Stage I and Stage U vapor recovery equipment and requirements at motor vehicle fuel dispensing facilities where Stage U vapor recovery equipment is required. A complete task under this section shall include all of the general requirements of paragraph 4 of Scope of Work Section and additionally: 17.1.1 Work Specific Guidance: • Stage H Vapor Recovery Policy and Procedure Manual,FODSOP Appendix 29 • Vapor Recovery Test Procedures Handbook,RG-399,November 2002 • Stage H portion of the TCEQ Compliance Monitoring Strategy 17.1.2 List of Sources. The PERFORMING PARTY shall identify and submit a list to TCEQ identifying those motor vehicle fuel dispensing facilities within the PERFORMING PARTY'S territorial jurisdiction where Stage H vapor recovery equipment is required pursuant to the TCEQ rules(30 TAC §§115.221 - 115.229 and §§115.241 - 115.249). The PERFORMING PARTY and the TCEQ agree that the number of investigations identified in Table 1 of Exhibit A-21 related to each of these investigations types for the local program shall constitute the initial Work plan for these programs. The Work Plan may be revised periodically as a Minor Change upon agreement of both parties. No additional compensation will be paid for any Stage Il investigations performed beyond the number identified in the Work Plan unless the Work Plan is modified by mutual agreement of both parties. 17.1.3 Maintaining the list of sources. A listing of Stage H facilities which were newly identified or TCEQ SFG Agreement. Contract No.582-4-64434 Page 24 June 19,2003 which were identified as closed or no longer in business shall be created and updated and maintained monthly by the PERFORMING PARTY. The listing shall include the total number identified during the calendar month and the cumulative number identified since the beginning of the fiscal year covered by this Agreement. 17.1.4 Special Reporting. None additional. 17.1.5 Violations Detected. The PERFORMING PARTY shall issue a notice of violation and initiate the enforcement action on all cases of nuisance, confirmed complaints, or any other violations of state air pollution laws or rules detected during a complaint investigation, as required by the most recent version of each of the previously cited exhibits in Scope of Work Section Item 4.2.1. 17.1.6 Timeliness of Data Entry. The PERFORMING PARTY shall enter all Stage I and Stage II investigation information into CCEDS within the time frames specified in the relevant exhibits. 17.1.7 Training and Committee Participation. Investigators conducting Stage I and 11 Vapor Recovery work shall attend the TCEQ-sponsored Stage II Vapor Recovery Annual Training or Stage II Committee meetings on an as scheduled basis. 18. Requirements Specific for the following Enforcement Activities program: Issuance of Notices of Violations Enforcement Case Development,Issuance of Notice of Enforcement and Enforcement Referral 18.1 A complete task under this section shall include all of the general requirements of paragraph 4 of the Scope of Work Section of this Agreement and additionally: 18.1.1 Work Specific Guidance: None additional. 18.1.2 List of Sources. The PERFORMING PARTY and the TCEQ agree that the number of investigations identified in Table 1 of Exhibit A-21 related to these investigations types for the local program shall constitute the initial Work Plan for this program. The Work Plan may be revised periodically as a Minor Change upon agreement of both parties. No additional compensation will be paid for any Enforcement Activities performed beyond the number identified in the Work Plan unless the Work Plan is modified by mutual agreement of both parties. 18.1.3 Response to Events. The PERFORMING PARTY shall conduct complete enforcement activities within the time frames established in the various investigation protocols,being particularly careful to meet any enforcement driven deadlines related to EPA's' High Priority Violation policy that are reflected in the various investigation and enforcement exhibits. 19. Requirements Specific for the following Other Investigation Related Activities program: Investigation Quality Review Activities 19.1 A complete task under this section shall include all of the general requirements of paragraph 4 of the Scope of Work Section of this Agreement and additionally: 19.1.1 Work Specific Guidance:It is recognized that the PERFORMING PARTY is responsible for the development of their own Investigation Quality Review program,and suggests the following guidelines that may be followed by the PERFORMING PARTY when implementing their program: • Stage 11 Vapor Recovery Policy and Procedure Manual,FODSOP Appendix 29, as it relates to Investigation QA/QC. Available as hard copy and individual sections on the T-Net under FODSOP at the following location: http://home.tceq.state.tx.us/egi-bin/intemal/enforcement/fodforms?page=FOD_SOP TCEQ SFG Agreement. Contract No.582-4-64434 Page 25 June 19,2003 • Vapor Recovery Test Procedures Handbook, RG-399,rev November 2002 Available as hard copy only • Field Operations Division Standard Operating Procedures (FODSOP), rev October 15, 2002, as it relates to Investigation QA/QC. 19.1.2 Reporting. In a separate section of the monthly report required under paragraph 4.2.8 of this section,provide a listing of the activities performed under this task for the month. 20. Requirements Specific for the following Other Investigation Related Activities program: Investigator Professional Development Program 20.1 A complete task under this section shall include all of the general requirements of paragraph 4 of the Scope of Work Section of this Agreement and additionally: 20.1.1 Work Specific Guidance: The PERFORMING PARTY shall develop and implement an Investigator Professional Development Program that complies with the requirements of the Scope of Work of this Agreement and that is consistent with the direction and intent of the requirements of the most recent version of the Investigator Professional Development Program for Air and Waste as follows: • Investigator Professional Program Development Documents for Air and Waste, rev 7/18/02 20.1.2 Level of Effort. The PERFORMING PARTY and the TCEQ agree that the amount of effort reflected in the level of funding identified in Table 1 of Exhibit A-21 related to this activity for the local program shall constitute the initial Work Plan for this program. The Work Plan may be revised periodically as a Minor Change upon agreement of both parties. No additional compensation will be paid for any Investigator Professional Development Program efforts performed beyond the level of effort identified through the level of funding identified in the Work Plan unless the Work Plan is modified by mutual agreement of both parties. 20.1.3 Special Reporting. None 20.1.4 Project Tracking. The Periodic Evaluation meetings identified in Paragraph 3 of this section will include a discussion of this topic. The PERFORMING PARTY will provide an update on progress made relative to this task at the meeting. 21. Requirements Specific for the following Other Investigation Related Activities program: Visibility Project Support 21.1 A complete task under this section shall include all of the general requirements of paragraph 4 of the Scope of Work Section of this Agreement and additionally: • Data Management Procedures for the El Paso Visibility Program, rev 1.0 21.1.1 Level of Effort. The PERFORMING PARTY and the TCEQ agree that the level of effort reflected in the number of activities identified in Table 1 of Exhibit A-21 related to this activity for the local program shall constitute the initial Work Plan for this program. The Work Plan may be revised periodically as a Minor Change upon agreement of both parties. No additional compensation will be paid for any Visibility Project Support efforts performed beyond the level of effort identified through the level of activity identified in the Work Plan unless the Work Plan is modified by mutual agreement of both parties. 21.1.2 Special Reporting. The PERFORMING PARTY shall submit data to the TCEQ in accordance with the requirements of Visibility Project Support Program. TCEQ SFG Agreement. Contract No.582-4-64434 Page 26 June 19,2003 21.1.3 Project Tracking. The Periodic Evaluation meetings identified in Paragraph 3 of this section will include a discussion of this topic. The PERFORMING PARTY will provide an update on progress made relative to this task at the meeting. 21.1.4 Provide the data transfer and other services in the manner required, timely, as required under the program guidance documents. 22. Requirements Specific for the following Other Investigation Related Activities program: Special Investigation Training/Equipment 22.1 A complete task under this section shall include all of the general requirements of paragraph 4 of the Scope of Work Section of this Agreement and additionally: Exhibit A-21: Local Air Program Work Plan, specifically the TRNG_EQUIP table, Table 4, of the exhibit. 22.1.1 Level of Effort. The PERFORMING PARTY and the TCEQ agree that the level of effort reflected in the participation in required training and purchase of required equipment identified in the TNRG_EQUIP table of Exhibit A-21 related to this activity for the local program shall constitute the initial Work Plan for this program. The Work Plan may be revised periodically as a Minor Change upon agreement of both parties. No additional compensation will be paid for any activities of this type beyond that identified in the Work Plan unless the Work Plan is modified by mutual agreement of both parties. 22.1.2 Provide a section in the monthly report indicating training received under this task and progress made in acquiring any equipment. END OF SCOPE OF WORK SECTION TCEQ SFG Agreement. Contract No.582-4-64434 Page 27 June 19,2003 GENERAL CONDITIONS OF THE TCEQ STATE FUNDED GRANT AGREEMENT ARTICLE 1. DEFINITIONS Wherever used in these General Conditions or in the other Agreement Documents the following terms have the meanings indicated which are applicable to both the singular and plural thereof- 1.1 hereof:1.1 Accrued expenditures -means the charges incurred by the PERFORMING PARTY during a given period requiring the provision of funds for: (1) Goods and other tangible property received; (2) services performed by employees, and(3)other amounts becoming owed under programs for which no current services or performance is required, such as annuities, insurance claims, and other benefit payments. 1.2 Accrued income-means the sum of: (1) Earnings during a given period from services performed by the PERFORMING PARTY and goods and other tangible property deliverable to purchasers, and (2)amounts becoming owed to the PERFORMING PARTY for which no current services or performance is required by the PERFORMING PARTY. 1.3 Acquisition cost -of an item of purchased equipment means the net invoice unit price of the property including the cost of modifications, attachments,accessories, or auxiliary apparatus necessary to make that property usable for the purpose for which it was acquired. Other charges such as the cost of installation, transportation,taxes, duty or protective in-transit insurance, shall be included or excluded from the unit acquisition cost in accordance with the PERFORMING PARTY's regular accounting practices. 1.4 Addenda-written or graphic instruments issued prior to the execution of the Agreement which clarify, correct or change the Proposal Requirements or the Agreement Documents. 1.5 Administrative requirements -mean those matters common to grants in general, such as financial management, kinds and frequency of reports, and retention of records. These are distinguished from "programmatic"requirements, which concern matters that can be treated only on a program-by-program or grant- by-grant basis, such as kinds of activities that can be supported by grants under a particular program. 1.6 Agreement-refers to the "TCEQ Form: TCEQ State Funded Grant Agreement"which contains the salient terms of the Agreement between TCEQ and the PERFORMING PARTY and covers the Work to be performed; also includes any additional Agreement Documents which may be attached to the Agreement and made a part thereof as provided therein. 1.7 Awarding agency-means the TCEQ. 1.8 This item left blank intentionally. 1.9 Cash contributions -means the PERFORMING PARTY's cash outlay, including the outlay of money contributed to the PERFORMING PARTY or subgrantee by other public agencies and institutions, and private legislation, federal funds received from other assistance Contracts may be considered as PERFORMING PARTY or subgrantee cash contributions. 1.10 Common rule-means the Uniform Grant Management Standards which were promulgated by the Texas Governor's Office of Budget and Planning pursuant to the Uniform Grant Conditions and Management Act,Tex. Govt. Code Chapter 783. TCEQ SFG Agreement. Contract No.582-4-64434 Page 28 June 19,2003 1.11 Contract-means (except as used in the definitions for"grant"and "subgrant" in this section and except where qualified by"federal") a procurement contract under a grant or subgrant, and means a procurement subcontract under a contract. 1.12 Agreement Documents - as set forth in the Agreement. 1.13 Agreement Price-the moneys payable by TCEQ to PERFORMING PARTY for completion of the Work in accordance with the Agreement Documents as stated in the Agreement(subject to the provisions of these General Conditions). 1.14 Agreement Times-the number of days or dates stated in the Agreement to complete the Work so that it is ready for final payment. 1.15 Cost sharing or matching- means the value of the third party in-kind contributions and the portion of the costs of a State assisted project or program not borne by the State. 1.16 Cost-type contract-means a contract or subcontract under a grant in which the PERFORMING PARTY or subcontractor is paid on the basis of the costs it incurs, with or without a fee. 1.17 defective-an adjective which when modifying the word Work refers to Work that is unsatisfactory, faulty or deficient,in that it does not conform to the Agreement Documents,or does not meet the requirements of any inspection,reference standard, test on approval referred to in the Agreement Documents, or has been damaged prior to final payment. 1.18 Effective Date of the Agreement -the date indicated in the Agreement on which it becomes effective,but if no such date is indicated it means the date on which the Agreement is signed and delivered by the last of the two parties to sign and deliver. 1.19 Equipment- means tangible,nonexpendable,personal property having a useful life of more than one year and an acquisition cost of$5,000 or more per unit. A PERFORMING PARTY may use its own definition of equipment provided that such definition would at least include all equipment defined above. "Equipment" definition pertaining to acquisition cost of$5,000 or more per unit as modified to subject state funds to the state definition or minimum cost for capitalized equipment. A state awarding agency will advise a PERFORMING PARTY of the rules for capitalizing equipment purchased from state funds and ultimate disposition thereof. 1.20 Expenditure report - means (1)For nonconstruction grants the "Financial Status Report" (Form B-5) (or other equivalent report); (2)for construction grants,the SF-271 "Outlay Report and Request for Reimbursement" (or other equivalent report). 1.21 Final Completion -the Work is completed in the judgment of TCEQ. 1.22 General Conditions -refers to the portion of the Agreement entitled:"General Conditions of the TCEQ State Funded Grant Agreement." 1.23 Government-means a State agency or local government. 1.24 Grant- means an award of financial assistance, including cooperative Agreement, in the form of money, or property in lieu of money,by the State to an eligible PERFORMING PARTY. The term does not include technical assistance which provides services instead of money, or other assistance in the form of revenue sharing, loans, loan guarantees, interest subsidies, insurance, or direct appropriations. Also, the term does not include assistance, such as a fellowship or other lump sum award,which the PERFORMING PARTY is not required to TCEQ SFG Agreement. Contract No.582-4-64434 Page 29 June 19,2003 account for. 1.25 Grantee- means the government to which a grant is awarded and which is accountable for the use of the funds provided. The grantee is the entire legal entity even if only a particular component of the entity is designated in the grant award document. Also means the PERFORMING PARTY. 1.26 HUB- Historically Underutilized Business as defined by Texas law. The State Purchasing and General Services Act,amended September 1, 1995, defines a historically underutilized business as a corporation or a partnership in which fifty-one percent (51%) or more of the corporation's stock(or other equitable securities)or partnership's assets and interest are owned by one or more economically disadvantaged persons, who have a proportionate interest and actively participate in the corporation or partnership control, operation, and management. If the business is a sole proprietorship, the economically disadvantaged person must completely own, operate and control the business. Economically disadvantaged person includes members of certain groups including American Women, Asian Pacific Americans, Black Americans, Hispanic Americans, and Native Americans. 1.27 Intellectual Property- 1) any and all inventions, discoveries, improvements,or creations for which copyright, trade secret,patent or other proprietary rights may be acquired, 2) any photographs, graphic designs, plans, drawings, specifications, computer programs,computer files, documentation,technical reports, operating manuals, or other copyright able materials, and 3)any other work fixed in any tangible medium of expression which can be perceived,reproduced, or otherwise communicated for which copyright, trade secret,patent or other proprietary rights may be acquired. 1.28 Intellectual Property Rights -patent, trademarks,trade secret rights, confidential information rights or any other proprietary rights to which a person may be entitled or may actually possess. Intellectual Property Rights include all rights of ownership and original authorship throughout the world. 1.29 Laws and Regulations; Laws or Regulations-any and all applicable laws,rules,regulations, ordinances, codes and orders of any and all governmental bodies, agencies, authorities and courts having jurisdiction. 1.30 Liens- liens,charges, security interests or encumbrances upon real property or personal property. 1.31 Local government- means a county,municipality, city, town,township, local public authority(including public and Indian housing agencies under the United States Housing Act of 1937,42 U.S.C. §1437 et seq.), school district, special district, intrastate district, council of governments(whether or not incorporated as a nonprofit corporation under state law),any other regional or interstate government entity, or any agency of instrumentality of a local government. 1.32 Major Change-any change in the work that meets the requirements of Article 6, Section 6.1 of the General Conditions of this Agreement 1.33 Major Source-For the purpose of this Agreement, a site that meets the definition of Major Source in 30 Tx Admin.Code Chapter 122, Section 122.10 or any site that is subject to the Title V permitting requirements of 30 Tx Admin Code Chapter 122.120. 1.34 Milestone-a principal event specified in the Agreement Documents relating to an intermediate completion date or time prior to Final Completion. 1.35 Minor Change- a written agreement which provides for minor changes in the work in accordance with these General Conditions, but which does not involve a change in the Agreement Price or in the nature or type of the Work activities to be performed, as described in Article 6 of the General Conditions of this Agreement. Any TCFQ SFG Agreement. Contract No.582-4-64434 Page 30 June 19,2003 minor change involving time allocated in the Work Plan to a given Work Plan item requires the written approval of the Air Section Manager in Austin prior to the change. 1.36 Non-Major Source-for the purposes of this Agreement, all those TCEQ Air program accounts that do not meet the definition of Sources of Interest to the EPA. 1.37 Obligations - means the amount of Work performed by the PERFORMING PARTY during a given period that may result in reimbursement by the TCEQ during the same or a future period. 1.38 Outlay- (expenditures)mean charges made to the project or program. They may be reported on a cash or accrual basis. For reports prepared on a cash basis, outlays are the sum of actual cash disbursement for direct charges for goods and services, the amount of indirect expense incurred, the value of in-kind contributions applied, and the amount of cash advances and payments made to PERFORMING PARTY and subgrantees. For reports prepared on an accrued expenditure basis, outlays are the sums of actual cash disbursements, the amount of indirect expense incurred, the value of in-kind contributions applied, and the new increase(or decrease) in the amounts owed by the PERFORMING PARTY for goods and other property received, for services performed by employees,contractors, subgrantees, subcontractors,and other payees, and other amounts becoming owed under programs for which no current services or performance are required, such as annuities, insurance claims, and other benefit payments. 1.39 Percentage of completion method-refers to a system under which payments are made for Work according to the percentage of the completed Work,rather than to the PERFORMING PARTY's cost incurred. 1.40 PERFORMING PARTY Representative-The individual authorized to receive direction from TCEQ, to act on behalf of PERFORMING PARTY, to manage the work being performed, and to perform all other duties and responsibilities as specified in the Statement of Services section . The PERFORMING PARTY Representative is the individual so named in paragraph 9.8 of Article 9, Miscellaneous, of this Agreement (relating to Notice). 1.41 Prior approval- means documentation evidencing consent prior to incurring specific cost. 1.42 Produced-participle or passive verb which when used in connection with the term Intellectual Property means conceived, developed, implemented, discovered, invented, first actually reduced to practice or otherwise produced. 1.43 Project- the total body of services rendered of which the Work to be provided under the Agreement Documents may be the whole, or a part as indicated elsewhere in the Agreement Documents. 1.44 Project Field Representative-The individual authorized to give direction to PERFORMING PARTY with respect to technical work(e.g., a Work plan, direct data entry, and training matters). A Project Field Representative is not authorized to bind TCEQ in Agreement or Agreement amendment unless the TCEQ Executive Director has delegated such authority to the individual named. The Project Field Representative of the TCEQ is the individual so named in paragraph 9.8 of Article 9 of this Agreement (relating to Notice). 1.45 Real property- means land, including land improvements, structures and appurtenances thereto, excluding movable machinery and equipment. 1.46 Share- when referring to the TCEQ's portion of real property, equipment or supplies,means the same percentage as the TCEQ's portion of the acquiring party's total costs under the grant to which the acquisition cost of the property was charged. Only costs are to be counted,not the value of third-party in-kind contributions. 1.47 Source of Interest to the EPA -For the purposes of this Agreement, any air pollution site that meets the TCEQ SFG Agreement. Contract No.582-4-64434 Page 31 June 19,2003 definition of Major Source as listed in this Agreement or any TCEQ Air Program account whose actual emissions equal or exceed 80%of the major source emissions threshold. 1.48 Standards - refers to the Uniform Grant and Contract Management Standards. 1.49 State-means the State of Texas. 1.50 Subcontractor-an individual, firm, or corporation having a direct contract with PERFORMING PARTY or with any other Subcontractor for the performance of a part of the Work. 1.51 Subgrant- means an award of financial assistance in the form of money, or property in lieu of money, made under a grant by the PERFORMING PARTY to an eligible subgrantee. The term includes financial assistance when provided by contractual legal agreement,but does not include procurement purchases,nor does it include any form of assistance which is excluded from the definition of"grant." 1.52 Subgrantee- means the government or other legal entity to which a subgrant is awarded and which is accountable to the PERFORMING PARTY for the use of the funds provided. "Subgrantee"is synonymous with "subrecipient"and refers to any entity receiving grant or contract funds from or through a state agency. 1.53 Supplies - means all tangible personal property other than "equipment" as defined in these General Conditions of this Agreement. 1.54 Suspension - means, depending on the context, either(1)temporary withdrawal of the authority to obligate grant funds pending corrective action by the PERFORMING PARTY,or subgrantee or a decision to terminate the grant,or (2)an action taken by a TCEQ official in accordance with the Agreement Documents, State or Federal law,or Regulations to immediately exclude a person from participating in grant transactions for a period, pending completion of an investigation and such legal or debarment proceedings as may ensue. 1.55 Termination-means permanent withdrawal of the authority to obligate previously-awarded grant funds before that authority would otherwise expire. It also means the voluntary relinquishment of that authority by the PERFORMING PARTY or subgrantee. "Termination"does not include: (1) withdrawal of funds awarded on the basis of the PERFORMING PARTY's underestimate of the unobligated balance in a prior period; (2)withdrawal of the unobligated balance as of the expiration of a grant; (3)refusal to extend a grant or award additional funds to make a competing or noncompeting continuation,renewal,extension or supplemental award; or(4)voiding of a grant upon determination that the award was obtained fraudulently or was otherwise illegal or invalid from inception. 1.56 Terms of a grant or subgrant- mean all requirements of the grant or subgrant,whether contained in statutes,regulations,or the Agreement Documents. 1.57 Third party in-kind contributions - mean property or services which benefit a state assisted project or program and which are contributed by third parties without charge to the PERFORMING PARTY, or a cost-type PERFORMING PARTY under the grant Agreement. 1.58 TCEQ-the Texas Commission on Environmental Quality. 1.59 TCEQ Local Program Contract Manager-The individual authorized to give general Agreement direction to the PERFORMING PARTY on behalf of the TCEQ primarily with respect to contract administrative matters, and works jointly with the TCEQ Local Program Project Manager in providing general direction to the PERFORMING PARTY . This individual is named in paragraph 9.8 of Article 9 of this Agreement(relating to Notice). The TCEQ Local Program Contract Manager is not authorized to bind the TCEQ in Agreement or TCEQ SFG Agreement. Contract No.582-4-64434 Page 32 June 19,2003 Agreement amendment unless the TCEQ Executive Director has delegated such authority to the individual named. 1.60 TCEQ Local Program Project Manager-The individual authorized to give general Agreement direction to the PERFORMING PARTY on behalf of the TCEQ primarily with respect to program technical matters, and works jointly with the TCEQ Local Program Contract Manager in providing general direction to the PERFORMING PARTY . This individual is named in paragraph 9.8 of Article 9 of this Agreement(relating to Notice). The TCEQ Local Program Contract Manager is not authorized to bind the TCEQ in Agreement or Agreement amendment unless the TCEQ Executive Director has delegated such authority to the individual named. 1.61 Unliquidated obligations-for reports prepared on a cash basis mean the amount of obligations incurred by the PERFORMING PARTY that has not been paid. Reports prepared on an accrued expenditure basis represent the amount of obligations incurred by the PERFORMING PARTY for which an outlay has not been recorded. 1.62 Unobligated balance-means the portion of the funds authorized by the TCEQ that has not been obligated by the PERFORMING PARTY, and is determined by deducting the cumulative obligations from the cumulative funds authorized. 1.63 Uniform Grant Management Standards (UGMS) -means the Uniform Grant Management Standards which were promulgated by the Texas Governor's Office of Budget and Planning pursuant to the Uniform Grant Conditions and Management Act, Tex. Govt. Code Chapter 783. 1.64 Work -the entire completed services or the various separately identifiable parts thereof required to be fur- nished under the Agreement Documents. Work includes and is the result of performing or furnishing labor, services,materials or equipment as required by the Agreement Documents. 1.65 Work Plan -A Work Plan agreed upon and submitted to or by the PERFORMING PARTY in accordance with the Statement of Services Section . The Work Plan consists of the number of the various Work Plan activities or tasks, as listed in Exhibit A-21: Local Air Program Work Plan for the relevant fiscal year together with written technical descriptions of, equipment, schedules, standards& workmanship as applied to the Work and certain administrative details applicable thereto. The Work Plan may be from time to time amended by exchange of correspondence between the PERFORMING PARTY and the TCEQ Project Field Representative and TCEQ Contract Manager consistent with the requirements of Article 6 of the General Conditions of this Agreement. 1.66 Written Amendment-a document signed by PERFORMING PARTY and TCEQ which authorizes an addition,deletion or revision in the Work, or an adjustment in the Agreement Price or the Agreement Times, issued on or after the Effective Date of the Agreement. ARTICLE 2. PRELIMINARY MATTERS Commencement of Agreement Times 2.1 The Agreement Times will commence to run on the Effective Date of the Agreement. ARTICLE 3. AGREEMENT DOCUMENTS: INTENT,AMENDING,REUSE Intent 3.1 The Agreement Documents comprise the entire Agreement between TCEQ and PERFORMING PARTY TCEQ SFG Agreement. Contract No.582-4-64434 Page 33 June 19,2003 concerning the Work. The Agreement Documents are complementary; what is called for by one is as binding as if called for by all. The Agreement Documents will be construed in accordance with the laws of the State of Texas. 3.2 It is the intent of the Agreement Documents to describe a functionally complete project(or part thereof) to be constructed in accordance with the total Agreement. Any Work, materials or equipment that may reasonably be inferred from the Agreement Documents or from prevailing custom or trade usage as being required to produce the intended result will be furnished and performed whether or not specifically called for. When words or phrases which have a well-known technical or pollution cleanup industry or trade meaning are used to describe Work, materials or equipment, such words or phrases shall be interpreted in accordance with that meaning. 3.3 Reference to Standards and Specifications of Technical Societies; Reporting and Resolving Discrepancies: 3.3.1 Reference to standards, specifications, guidance manuals or codes of any governmental authority or technical society, organization or association, or to the Laws or Regulations of any governmental authority, whether such reference be specific or by implication, shall mean the latest standard, specification, guidance manual, code or Laws or Regulations in effect at the time of(the Effective Date of the Agreement), except as may be otherwise specifically stated in the Agreement Documents. 3.3.2 If, during the performance of the Work,PERFORMING PARTY discovers any conflict, error, ambiguity or discrepancy within the Agreement Documents or between the Agreement Documents and any provision of any such Law or Regulation applicable to the performance of the Work or any such standard, specification, guidance manual or code, PERFORMING PARTY shall report it to TCEQ in writing at once. PERFORMING PARTY shall not proceed with the Work affected thereby (except in an emergency as authorized by these Agreement Documents)until an amendment or supplement to the Agreement Documents has been issued by one of the methods indicated in these Agreement Documents; provided,however, that PERFORMING PARTY shall not be liable to TCEQ for failure to report any such conflict,error, ambiguity or discrepancy unless PERFORMING PARTY knew or reasonably should have known thereof. 3.3.3 Except as otherwise specifically stated in the Agreement Documents or as may be provided by amendment or supplement thereto issued by one of the methods indicated in these General Conditions of this Agreement,provisions of the Agreement Documents shall take precedence in resolving any conflict,error, ambiguity or discrepancy between the provisions of the Agreement Documents and: 3.3.3.1 the provisions of any such standard, specification,guidance manual, code or instruction (whether or not specifically incorporated by reference in the Agreement Documents); or 3.3.3.2 the provisions of any such Laws or Regulations applicable to the performance of the Work (unless such an interpretation of the provisions of the Agreement Documents would result in violation of such Law or Regulation). 3.3.4 No provision of any such standard, specification, guidance manual, code or instruction shall be effective to change the duties and responsibilities of TCEQ or PERFORMING PARTY, or any of their subcontractors, consultants, agents,or employees from those set forth in the Agreement Documents,nor shall it be effective to assign to TCEQ, any duty or authority to supervise or direct the furnishing or performance of the Work or any other provision of the Agreement Documents. 3.3.5 Whenever in the Agreement Documents the terms "as ordered,""as directed,""as required," "as allowed," "as approved'.'or terms of like effect or import are used,or the adjectives "reasonable," "suitable,""acceptable,""proper"or"satisfactory"or adjectives of like effect or import are used to describe a requirement, direction,review or judgment of TCEQ as to the Work, it is intended that such requirement, direction,review or judgment will be solely to evaluate, in general, the completed Work for compliance with the requirements of and information in the Agreement Documents and conformance with the design concept of the completed Project as a functioning whole as shown or indicated in the Agreement Documents(unless there is a specific statement indicating otherwise). The use of any such term or adjective shall not be effective to assign to TCEQ any duty or authority to supervise or direct the furnishing or performance of the Work or any other provision of the Agreement Documents. 3.3.6 Agreement and guidance documents will ordinarily be provided to the PERFORMING PARTY utilizing electronic means, such as e-mail or by posting of such documents on the agency T-Net in a place accessible by the PERFORMING PARTY and will also be made available as hard copy when that is the form utilized by the TCEQ for dissemination of the documents to agency personnel. TCEQ SFG Agreement. Contract No.582-4-64434 Page 34 June 19,2003 Agreement Documents unique to this contract will be made available to the PERFORMING PARTY via hard copy. Amending and Supplementing Agreement Documents: 3.4 The Agreement Documents may be amended to provide for additions, deletions and revisions in the Work or to modify the terms and conditions thereof in one or more of the following ways: 3.4.1 a formal Written Amendment,by action of PERFORMING PARTY or his designee and the TCEQ or his designee. 3.4.2 a Minor Change,by action of PERFORMING PARTY or his designee and the TCEQ or his designee. 3.4.3 The TCEQ may from time to time issue revisions to the Exhibits in accordance with provisions specifically identified in the Scope of Work of the Agreement. ARTICLE 4. PERFORMING PARTY'S RESPONSIBILITIES 4.1 The PERFORMING PARTY shall be responsible for the professional quality, technical accuracy, timely completion and the coordination of all services and other work furnished by the PERFORMING PARTY under this Agreement. Supervision and Superintendence: 4.2 PERFORMING PARTY shall supervise, inspect and direct the Work competently and efficiently, devoting such attention thereto and applying such skills and expertise as may be necessary to perform the Work in accordance with the Agreement Documents. PERFORMING PARTY shall be solely responsible for the means, methods, techniques, sequences and procedures of the Work. PERFORMING PARTY shall be responsible to see that the completed Work complies accurately with the Agreement Documents. PERFORMING PARTY's Representative 4.3 The PERFORMING PARTY agrees to make arrangements necessary to ensure that the PERFORMING PARTY Representative, or someone to whom that person has delegated his or her authority, is available at all reasonable times for consultation with the TCEQ. Written notice of any such delegation shall be provided to the TCEQ. Personnel 4.4 PERFORMING PARTY shall provide competent, suitably qualified personnel to perform the Work as required by the Agreement Documents. PERFORMING PARTY shall at all times maintain good discipline and order on the project. Employment Practices 4.5 The PERFORMING PARTY agrees that in the performance of this Agreement, it will not discriminate against any employee or applicant because of race, religion, color, sex, age, or national origin and it will comply with Executive Order 11246, entitled "Equal Employment Opportunity,"as amended by Executive Order 11375, and as supplemented in Department of Labor Regulations(41 CFR Part 60). The PERFORMING PARTY assures that no person will, on the grounds of race, creed,color, disability,national origin, sex,political affiliation or beliefs,be excluded from,be denied the benefit of, or be subject to discrimination under any program or activity funded in whole or part under this Agreement. Americans with Disabilities Act 4.6 The PERFORMING PARTY shall comply with all applicable requirements of the Americans with Disabilities Act of 1990,42 U.S.C. §12131 et seq., as well as state and federal statutes relating to nondiscrimination which include,but are not limited to, those listed in the Uniform Grant Management Standards. TCEQ SFG Agreement. Contract No.582-4-64434 Page 35 June 19,2003 Materials & Equipment 4.7 Unless otherwise specified in the Agreement Documents, PERFORMING PARTY shall furnish and assume full responsibility for all materials, equipment, labor, transportation, tools, appliances, fuel,power, light,heat, telephone, water, sanitary facilities, temporary facilities and all other facilities and incidentals necessary for the furnishing,performance, testing, start-up and completion of the Work. 4.8 All materials and equipment shall be of good quality and new, except as otherwise provided in the Agreement Documents. All materials and equipment shall be applied, installed, connected, erected, used, cleaned and conditioned in accordance with instructions of the applicable Supplier, except as otherwise provided in the Agreement Documents. Title to and Management of Equipment 4.9 Subject to the obligations and conditions set forth in this Agreement, title to all equipment acquired under this Agreement shall vest, upon acquisition or construction, in the PERFORMING PARTY. 4.10 The PERFORMING PARTY agrees to conduct physical property inventories, to maintain property records and necessary control procedures, and to provide adequate maintenance with respect to all equipment acquired under this Agreement. 4.11 The PERFORMING PARTY may develop and use its own property management system which must conform with all applicable State and local laws,rules and regulations. If an adequate system for accounting for personal property owned by the PERFORMING PARTY or its subcontractor is not in place or currently in use, the Property Accounting System Manual issued by the State of Texas General Services Commission shall be used as a guide for establishing such a system. 4.12 Property records must be maintained that include a description of the property, a serial number or other identification number, the source of property,who holds title, the acquisition date, and the cost of the property, percentage of federal participation in the cost of the property, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. 4.13 A physical inventory of all equipment acquired or replaced under this Agreement having an initial purchase price of Five Thousand Dollars ($5,000)or more, shall be conducted no less frequently than once every two years and the results of such inventories reconciled with the appropriate property records. Property control procedures utilized by the PERFORMING PARTY shall include adequate safeguards to prevent loss, damage, or theft of the acquired property. Any loss,damage or theft shall be investigated. The PERFORMING PARTY agrees to develop and carry out a program of property maintenance as necessary to keep both originally acquired and any replaced property in good condition, and to utilize proper sales procedures to ensure the highest possible return, in the event such equipment is sold. 4.14 All equipment acquired or replaced under this Agreement shall be used for the duration of its normally expected useful life to support the purposes of this Agreement whether or not the original projects or programs continue to be supported by federal or state funds. 4.15 Subject to the provisions of this Article, if no longer needed for the support of the authorized projects or programs referred to in paragraph 4.14 of this Article, equipment acquired under this Agreement, whether original or replacement, may be used in support of other activities currently or previously supported by the State or TCEQ, or alternatively,may be made available for use on other projects or programs, providing such other use will not interfere with the work on those projects or programs for which such equipment was originally acquired. 4.16 The PERFORMING PARTY may for the purpose of replacing various equipment utilized under this Agreement,either trade in or sell the equipment or property referred to in paragraph 4.9 and use the proceeds of such trade-in or sale to offset the cost of acquiring needed replacement property. 4.17 If any equipment acquired or replaced under this Agreement is sold or transferred within six years of the TCEQ SFG Agreement. Contract No.582-4-64434 Page 36 June 19,2003 initiation date of the Agreement, the PERFORMING PARTY agrees that the TCEQ is entitled to a share of the proceeds from such sale,provided the fair market,per-unit value of the property at the time of the sale is in excess of Five Thousand Dollars ($5,000). The TCEQ's share of the sale proceeds shall be the same percentage as was the funding provided under this Agreement that enabled the original purchase in question. Equipment that is no longer needed and that has a fair market, per-unit value of Five Thousand Dollars ($5,000) or less may be retained, sold, transferred, or otherwise disposed of with no further obligation to the TCEQ,provided the requirements set forth in this paragraph 4.18 and paragraph 4.19 are followed. If the equipment has a fair market, per-unit value of one thousand dollars Five Thousand Dollars ($5,000) or more and less than six (6)years has elapsed from the initiation of the Agreement, the PERFORMING PARTY or the subcontractor must contact the TCEQ for final disposition instructions. 4.18 If prior to the termination date of this Agreement, the PERFORMING PARTY or its subcontractors or subgrantees determine that any equipment acquired with funds provided as a result of this Agreement is no longer needed for support of the programs or projects referred to in paragraph 4.14, the TCEQ may require the PERFORMING PARTY to transfer title and possession to such equipment to the TCEQ or a third party named by the TCEQ. 4.19 The PERFORMING PARTY agrees that if a determination is made within six years of the initiation date of this Agreement that any equipment acquired with funds provided as a result of this Agreement is no longer needed for support of the programs or projects referred to in paragraph 4.14,the TCEQ has a right to require the transfer of any equipment having a fair market,per unit value of more than Five Thousand Dollars ($5,000)to the TCEQ or a third party named by the TCEQ. 4.20 The PERFORMING PARTY shall not grant or allow to a third party a security interest in any original or replacement equipment purchased or constructed with funds made available to PERFORMING PARTY under this Agreement. 4.21 The PERFORMING PARTY agrees that, in the event any funds provided under this Agreement are in turn awarded to any subcontractor for the purchase or acquisition of any equipment by such other party, the PERFORMING PARTY's Agreement with that subcontractor shall include the requirements set forth in these General Conditions. Substitutes and "or-Equal"Items: 4.22 Whenever an item of material or equipment is specified or described in the Agreement Documents by using the name of a proprietary item or the name of a particular Supplier, the specification or description is intended to establish the type,function and quality required.Unless the specification or description contains or is followed by words reading that no like, equivalent, or"or-equal"item or no substitution is permitted,other items of material or equipment of other Suppliers may be accepted by TCEQ. 4.23 Substitute Methods or Procedures: If a specific means,method,technique, sequence or procedure is shown or indicated in and expressly required by the Agreement Documents,PERFORMING PARTY may furnish or utilize a substitute means,method, technique, sequence or procedure acceptable to TCEQ. PERFORMING PARTY shall submit sufficient information to allow TCEQ, in TCEQ's sole discretion,to determine that the substitute proposed is equivalent to that expressly called for by the Agreement Documents. Concerning Subcontractors,Suppliers and Others 4.24 All Agreement expenditures using funds provided under this Agreement shall meet all procurement laws and regulations applicable to the PERFORMING PARTY and any subcontractor or subrecipient and the Uniform Grant and Agreement Management Act, the Uniform Grant Management Standards, and, as applicable,48 CFR Part 31, and the Professional Services Procurement Act. Note that competitive bidding will generally be required for Agreements other than interlocal and interagency Agreements, which are under TEx.Gov.CODE,Chapter 791 et seq. Note also that the Common Rule of OMB Circular A-102,as adopted in the Uniform Grant Management Standards,precludes the use of the cost plus a percentage of cost method of contracting. . TCEQ SFG Agreement. Contract No.582-4-64434 Page 37 June 19,2003 4.25 All subgrant agreements must be in writing and must be approved by the TCEQ. The standards and requirements for reimbursements and standards for performance will be incorporated into the subgrant agreements as well as other provisions required by this Agreement. The PERFORMING PARTY shall forward any proposed subcontract providing services under this Agreement to the TCEQ prior to execution of the subcontract. The TCEQ may, within twenty-one(2 1) days of receipt of the proposed subcontract,provide written notice(fax acceptable) to the PERFORMING PARTY questioning whether the subcontract is for a legitimate purpose relating to the satisfaction of this Agreement or has been procured in accordance with the minimum standards of the UGCMA and UGMS. The PERFORMING PARTY shall not enter into a questioned subcontract until the TCEQ has withdrawn all questions raised in the notice. Neither the TCEQ's failure to question a subcontract nor its subsequent withdrawal of any questions raised regarding a subcontract shall in any way imply the TCEQ's approval of the subcontract's purpose or method of procurement of the subcontract. Further, the terms of this provision do not in any way restrict the TCEQ's rights under this Agreement to subsequently refuse reimbursement for expenses incurred pursuant to the subcontract. The PERFORMING PARTY may require a bid bond to protect the local and state interests by assuring that a bidder will, upon acceptance, execute all required contractual documents within the time period specified. 4.26 No employee, officer or agent of the PERFORMING PARTY shall participate in selection,or in the award or administration of a contract supported by State funds if a conflict of interest,real or apparent, would be involved. Such a conflict arises when: 4.26.1 The employee, officer or agent, 4.26.2 Any member of his immediate family, 4.26.3 His or her partner, or 4.26.4 An organization which employs, or is about to employ any of the above, has financial or other interest in the subcontractor selected. The officers, employees or agents will neither solicit nor accept gratuities, favors or anything of monetary value from contractors,potential contractors, or parties to subcontractors. To the extent permitted by State or local law or regulations, such standards of conduct will provide for penalties, sanctions, or other disciplinary actions for violations of such standards by the PERFORMING PARTY officers, employees,or agents, or by contractors or their agents. See Uniform Grant Management Standards,Part III, Subpart C, Sec._.36(3). 4.27 The PERFORMING PARTY shall be responsible for the management and fiscal monitoring of all subcontractors and subgrantees. The PERFORMING PARTY shall monitor its subcontractors and subgrantees to ensure that the subcontractors and subgrantees are operating consistently with applicable laws and regulations, applicable contractive policies, and these Agreement Documents. The PERFORMING PARTY shall ensure that all subcontractors and subgrantees comply with all recording keeping and access requirements set forth in these Agreement Documents. The TCEQ reserves the right to perform an independent audit of all subcontractors and subgrantees. PERFORMING PARTY, subcontractors and subgrantees shall maintain detailed records. 4.28 Funds provided by the TCEQ pursuant to this Agreement that are paid to the subcontractor shall be used by the subcontractor solely to satisfy the purposes of the Agreement. Procurements and Subgrants 4.29 All expenditures involving agreements with entities defined as subrecipients under UGMS shall be subject to the cost principles listed in §_.22 of the Common Rule of OMB Circular A-102 for the applicable subrecipient type. Any such agreement with a for-profit entity requires a cost analysis and shall follow the cost principles in 48 CFR, Part 31. 4.30 All contractual expenditures involving purchases from entities defined as vendors under UGMS shall be made according to the requirements relating to procurement in Sec.—.36 of the Common Rule of OMB Circular A-102,as adopted in the Uniform Grant Management Standards. 4.31 PERFORMING PARTY shall perform a cost or price analysis in connection with all subcontracts in excess of$2,000 which are not competitively procured. A cost analysis will also be required when adequate price competition is lacking and for sole source procurements,unless the reasonableness of the price can be established TCEQ SFG Agreement. Contract No.582-4-64434 Page 38 June 19,2003 on the basis of a catalog or market price. Failure to follow these requirements for providing the greatest possible competition in a procurement are grounds for disallowance of costs for reimbursement. 4.31.1 All subcontractors with subrecipients or vendors which are paid on the basis of the subrecipient's or vendor's costs require a cost analysis. In addition, all subcontracts which have not been procured by a method requiring price competition,and all subcontracts modifications (or Change Orders),require a cost analysis unless price reasonableness can be established on the basis of a catalog or market price of a commercial product sold in substantial quantities to the general public or based on prices set by law or regulation. Cost(or prices based on estimated costs) are allowable only to the extent that they are consistent with the cost principles listed in §_.22 of the Common Rule of OMB Circular A-102 for the applicable subrecipient or vendor type. Specifically, the cost principles of 48 CFR Part 31 are applicable for-profit entities. 4.31.2 PERFORMING PARTY shall negotiate profit as a separate element of the price in all subcontracts with subrecipients in which profit is allowed, and all subcontracts with vendors which require a cost analysis to be performed. PERFORMING PARTY may negotiate profit as a separate element of a lump sum Agreement price, or as a fixed fee to be paid in addition to reimbursement of actual costs incurred. All lump sum subcontracts negotiated on the basis of a cost analysis shall contain a clause providing for a reduction in the amount to be paid in the event that cost data used in negotiating the price is defective or not current. PERFORMING PARTY shall not enter into a subcontracts with a subrecipient or a vendor which is to be paid on the basis of cost plus a percentage of costs. 4.32 All subgrants awarded by the PERFORMING PARTY under this Agreement shall be in accordance with Chapter 2259 Texas Government Code and Part III Subpart C, Sec._.37, Subsection (b) of UGMS. 4.32.1 All subgrants awarded by the PERFORMING PARTY under this Agreement will be awarded on the basis of competitive applications and proposals when feasible. The applications and proposals will be evaluated utilizing criteria including cost comparison,probable quality of goods or services and past performance. Upon request,PERFORMING PARTY must provide evidence to support the selection and award. 4.32.2 Payments by PERFORMING PARTY to subgrantees will be solely for reimbursement of actual allowable costs utilizing the same standards and requirements as the reimbursement payments from TCEQ to PERFORMING PARTY set out in this Agreement. No subgrant will be made on a fixed- amount of cost reimbursement unless this method is specifically approved by the TCEQ based on supporting evidence of proposed subgrantee's actual costs. Historically Underutilized Businesses (HUBS): 4.33 PERFORMING PARTY agrees that qualified HUBS shall have the maximum practicable opportunity to participate in the performance of the Work. 4.34 PERFORMING PARTY will submit a completed HUB/MWBE PROGRESS ASSESSMENT REPORT, contained in Form B-1, with each quarterly invoice and voucher submitted under the provisions of Article 7 of these General Conditions of this Agreement,Payments to PERFORMING PARTY and Completion of the TCEQ State Funded Grant Agreement. 4.35 PERFORMING PARTY's failure to comply with this Article shall be grounds for termination for cause in accordance with Article 8 of these General Conditions of this Agreement. Intellectual Property Requirements 4.36 Intellectual Property 4.36.1 Royalties and Patent Fees. PERFORMING PARTY shall pay all license fees and royalties and assume all costs incident to the use or possession in the performance of the Work or the incorporation in the Work of any Intellectual Property. 4.36.2 Disclosure of Intellectual Property Produced during the Work. PERFORMING PARTY shall promptly notify TCEQ of all Intellectual Property which PERFORMING PARTY or PERFORMING PARTY's employees, subcontractors, or subcontractor's employees may produce, either solely or jointly with others, during the course of the Work. In addition,PERFORMING PARTY shall TCEQ SFG Agreement. Contract No.582-4-64434 Page 39 June 19,2003 promptly notify TCEQ of all Intellectual Property to which PERFORMING PARTY may acquire rights in connection with the performance of the Work. Any notification under this paragraph shall contain sufficient technical detail to convey a clear understanding of the Intellectual Property, and shall identify any publication,sale,public use, or impending publication. Promptly upon request, PERFORMING PARTY shall supply such additional information as TCEQ may request. 4.36.3 If PERFORMING PARTY fails to protect any Intellectual Property Rights in the Intellectual Property Rights in the Intellectual Property Produced in the course of performing the Work, TCEQ shall have full authority to protect, assume and retain all Intellectual Property Rights in any and all such Intellectual Property. 4.36.4 PERFORMING PARTY agrees that PERFORMING PARTY, its agents, and its employees shall not in any manner use, sell, distribute,disclose or otherwise communicate any portion of Intellectual property owned by or licensed to TCEQ,except in the course of performing the Work,unless PERFORMING PARTY has independent Intellectual Property Rights to such Intellectual Property. 4.36.5 Grant of License. With respect to such Intellectual Property as is(i) incorporated in the Work(other than Intellectual Property for which TCEQ already possesses equal or greater Intellectual Property Rights by virtue of this Agreement or otherwise), (ii)produced by PERFORMING PARTY or PERFORMING PARTY's employees, subcontractors, or subcontractor's employees during the course of performing the Work,or(iii)specifically identified in the Supplemental Conditions as Intellectual Property to which Intellectual Property Rights are granted pursuant to this paragraph, PERFORMING PARTY hereby grants to TCEQ (i) a nonexclusive, perpetual, irrevocable, enterprise-wide license to reproduce,publish,or otherwise use such Intellectual Property and associated use documentation, and (ii) a nonexclusive,perpetual, irrevocable, enterprise-wide license to authorize others to reproduce,publish,or otherwise use such Intellectual Property for TCEQ's purposes. 4.36.6 Modification; Derivative Works. TCEQ shall have the right,in its own discretion, to independently modify any Intellectual Property to which license is granted herein for TCEQ's own purposes and use,through the services of its own employees or independent contractors.TCEQ shall own all Intellectual Property Rights to such modifications. PERFORMING PARTY shall not incorporate any such modifications into its Intellectual Property for distribution to third parties unless it first obtains a license from TCEQ. 4.36.7 PERFORMING PARTY shall comply with all Laws and Regulations relating to Intellectual Property. PERFORMING PARTY represents and warrants to TCEQ that PERFORMING PARTY will not infringe any Intellectual Property Right of any third party. PERFORMING PARTY further represents and warrants to TCEQ that in the course of performing the Work it will not use or possess any Intellectual Property owned by a third party without paying any required royalty or patent fees. PERFORMING PARTY warrants that it has full title in and ownership of the Intellectual Property and any enhancements,updates or other modifications, or that it has full power and authority to grant all licenses granted herein, and that such license use by the TCEQ will in no way constitute an infringement or other violation of any Intellectual Property right of any third party. The PERFORMING PARTY warrants that it shall have, throughout any applicable license term hereunder, free and clear title to,or the right to possess, use sell,transfer, assign, license, or sublicense, products that are licensed or provided hereunder to the TCEQ by PERFORMING PARTY. Except as permitted in the Agreement Documents,PERFORMING PARTY shall not create or permit the creation of any lien, encumbrance,or security interest in the Work or any part thereof, or any product licensed or provided hereunder to TCEQ for which title has not yet passed to TCEQ, without the prior written consent of TCEQ. PERFORMING PARTY represents and warrants to TCEQ that neither it nor any other company or individual performing the Work is under any obligation to assign or give to any third party any Intellectual Property rights granted or assigned to TCEQ,or reserved by TCEQ,pursuant to the Agreement Documents. 4.36.8 To the fullest extent permitted by Laws and Regulations,PERFORMING PARTY shall indemnify and hold harmless TCEQ, and its officers, directors, employees and agents, as more fully specified in these General Conditions, from and against all fines,penalties, claims, damages, losses, demands, judgments, settlements,punitive damages, costs of suit,attorneys' fees and delays to the contractors, whether arising in tort or otherwise, and whether the parties are individually or jointly responsible from any damages, that arise out of,result from or relate to any infringement of property, contractual, or employment rights or Intellectual Property Rights incident to the use in the performance of the TCEQ 5FG Agreement Contract No.582-4-64434 Page 40 June 19,2003 Work or resulting from the incorporation in the Work of any Intellectual Property. PERFORMING PARTY agrees that it will make no settlement which prevents TCEQ from continuing use of the Intellectual Property without TCEQ's prior written approval. In all events, TCEQ shall have the right to participate in the defense of any such suit or proceeding through counsel of its own choosing. Technology Access Clause 4.37 PERFORMING PARTY expressly acknowledges that state funds may not be expended in connection with the purchase of an automated information system unless the system meets certain statutory requirements under section 2157.005 of the Government Code, relating to accessibility by persons with visual impairments. Accordingly, the PERFORMING PARTY represents and warrants to TCEQ that the technology provided to TCEQ for purchase is capable, either by virtue of features included within the technology or because it is readily adaptable by use with other technology, of(1)providing equivalent access for effective use by both visual and nonvisual means; (2)presenting information, including prompts used for interactive communications, in formats intended for nonvisual use; and (3)being integrated into networks for obtaining, retrieving, and disseminating information used by individuals who are not blind or visually impaired. For purposes of this paragraph,the phrase "equivalent access"means a substantially similar ability to communicate with or make use of the technology,either directly by features incorporated within the technology or by other reasonable means such as assistive devices or services which would constitute reasonable accommodations under the Americans with Disabilities Act or similar state or federal laws. Examples of methods by which equivalent access may be provided include,but are not limited to, keyboard alternatives to mouse commands and other means of navigating graphical displays, and customizable display appearance. 4.38 Reserved. 4.39 The PERFORMING PARTY shall include provisions adequate to effectuate the purposes of this paragraph in all subcontracts under this Agreement in the course of which Intellectual Property may be produced or acquired. Permits 4.40 Unless otherwise provided in the Agreement Documents,PERFORMING PARTY shall obtain and pay for all construction permits and licenses. PERFORMING PARTY shall pay all charges of utility owners for connections to the Work, and PERFORMING PARTY shall pay all charges of such utility owners for capital costs related thereto such as plant investment fees. Laws and Regulations 4.41 PERFORMING PARTY shall give all notices and comply with all Laws and Regulations applicable to furnishing and performance of the Work. Except where otherwise expressly required by applicable Laws and Regulations, TCEQ shall not be responsible for monitoring PERFORMING PARTY's compliance with any Laws or Regulations. 4.42 If PERFORMING PARTY performs any Work knowing or having reason to know that it is contrary to Laws or Regulations,PERFORMING PARTY shall bear all claims, costs, losses and damages caused by, arising out of or resulting therefrom. Uniform Grant and Agreement Management Act 4.43 The provisions of Uniform Grant and Agreement Management Act,TEx. Gov.CODE, Chapter 783 applies to this Agreement, all amendments thereto, and all subcontracts and subagreements. Compliance with the conditions and requirements contained therein is necessary for the satisfactory performance of the services and work required under this Agreement. Energy Efficiency Standards TCEQ 5FG Agreement. Contract No.582-4-64434 Page 41 June 19,2003 4.44 The PERFORMING PARTY shall follow standards and policies on energy efficiency which are contained in the Texas State Energy Conservation Plan issued in compliance with federal requirements. Taxes 4.45 Where applicable PERFORMING PARTY shall pay all sales, consumer, use and other similar taxes required to be paid by PERFORMING PARTY in accordance with the Laws and Regulations in connection with the work required by this Agreement. Records,Documents,Data,Access, and Audit 4.46 The PERFORMING PARTY shall maintain books,records, documents, and other evidence reasonably pertinent to performance of the Work and requirements of the Agreement Documents, including the Agreement or amendments thereto. All financial records shall be maintained in accordance with generally accepted accounting principles, the Uniform Grant Management Standards and these Agreement Documents. The PERFORMING PARTY shall also maintain the financial information and data used in the preparation or support of any request for reimbursement(direct and indirect),price or profit analysis for this Agreement or any subagreement or subcontract and a copy of any cost information or analysis submitted to the TCEQ. The TCEQ, Texas State Auditor's Office, or any of their authorized representatives shall have access to all such books, records,documents and other evidence for the purpose of review, inspection, audit, excerpts, transcriptions and/or copying during normal business hours. The PERFORMING PARTY shall provide proper facilities for such access and inspection. 4.47 The PERFORMING PARTY agrees that all record keeping and access requirements shall be applicable to all subcontracts and subagreements. 4.48 The PERFORMING PARTY agrees to the disclosure of all information and reports resulting from access to records under this Agreement. 4.49 Records under paragraph 4.46 and 4.47 of this Article shall be maintained by the PERFORMING PARTY during performance of Work under this Agreement, and for five(5) years for records related to sources investigated and for three(3) for all other records after final payments, final expenditure reports and all other pending matters are closed. If any litigation, claim,negotiation, audit, cost recovery, or other action (including actions concerning costs of items to which an audit exception has been taken) involving such records has been started before the expiration of the specified period, such records must be retained until completion of the action or resolution of all issues which arise from it, or until the end of the regular specified year period, whichever is later. 4.50 Access to records is not limited to the required retention periods. The entities designated in paragraph 4.46 shall have access to records at any reasonable time for as long as the records are maintained. 4.51 This right-of-access article applies to financial records pertaining to this Agreement and all subagreements and amendments. In addition, this right of access article applies to all records pertaining to this Agreement and all subagreements and amendments: 4.5 1.1 to the extent the records pertain reasonably to Agreement or subcontract performance; 4.51.2 if there is any indication that fraud, gross abuse, or corrupt practices may be involved; or 4.51.3 if the Agreement or subcontract is terminated for default or for convenience. TCEQ SFG Agreement. Contract No.582-4-64434 Page 42 June 19,2003 Data and Publicity 4.52 All data and other information developed under this Agreement shall be furnished to the TCEQ and shall be public data and information except to the extent that it is exempted from public access by the Texas Public Information Act,TEX.GovT.CODE § 552 ("Act"). Upon termination of this Agreement, all copies of data and information shall be furnished, at no charge to the TCEQ, upon request, to include data bases prepared using funds provided under this Agreement, and become the property of the TCEQ. Except as otherwise provided by these Agreement Documents or the Act,the PERFORMING PARTY shall not provide data generated or otherwise obtained in the performance of its responsibilities under this Agreement to any party other than the State of Texas and its authorized agents. 4.53 The PERFORMING PARTY agrees to notify and obtain the verbal approval of TCEQ prior to releasing any information to the news media regarding the activities being conducted under this Agreement. Safety and Protection 4.54 Where applicable,PERFORMING PARTY shall be responsible for requiring subcontractors and subgrantees to maintain and supervise all necessary safety precautions and programs in connection with the Work. PERFORMING PARTY shall take all necessary safety precautions. Independent Contractor 4.55 In performing any services hereunder, the PERFORMING PARTY is, and undertakes performance as, an independent contractor. Lobbying Activities 4.56 As set forth in these Agreement Documents, and in accordance with the Uniform Grant Management Standards,and State law,PERFORMING PARTY shall not use funds provided under this Agreement to support political activity either directly or indirectly. This preclusion includes funds paid in reimbursement of direct or indirect costs. Performance Reports 4.57 In accordance with the Uniform Grant Management Standards,the PERFORMING PARTY shall submit written progress reports documenting all activities during a quarter pursuant to the schedule of deliverables set forth in Part B Deliverables of the Scope of Work-Section 01000 of this Agreement. In the absence of a schedule in work plan, the PERFORMING PARTY shall submit the reports not later than thirty(30)days after the close of each quarter. The reporting periods shall correspond to the State of Texas fiscal year(September- November; December-February,March-May; June-August). Accounting Systems 4.58 The PERFORMING PARTY shall have an accounting system which accounts for costs in accordance with generally accepted accounting standards or principles and complies with applicable State law,regulations, and policies relating to accounting standards or principles. The PERFORMING PARTY must account for costs in a manner consistent with such standards or principles. Independent Financial Audit 4.59 The PERFORMING PARTY shall engage an independent financial auditor and conduct an annual audit of the PERFORMING PARTY'S financial statements in accordance with the Single Audit provisions of UGMS and 4.59.1 All terms used in connection with audits in this Agreement shall have the definitions and meanings assigned in the Single Audit Circular in UGMS. 4.59.2 Provisions of the Single Audit Circular in Part IV of UGMS shall apply to all non-state government TCEQ SFG Agreement. Contract No.582-4-64434 Page 43 June 19,2003 entities expending the funds of this grant, whether they are recipients,receiving the funds directly from the TCEQ, or are subrecipients,receiving the funds from a pass-through entity(a recipient or another subrecipient). In addition, the PERFORMING PARTY shall require the independent auditor to supply all audit work papers substantiating the work performed, at the request of the TCEQ or its designee. Exceptions in Audit 4.59.3 TCEQ is required to take action on exceptions noted in an audit of PERFORMING PARTY's financial records. Therefore, PERFORMING PARTY agrees to submit to TCEQ a copy of the report of any audit conducted of the PERFORMING PARTY's financial records within twenty(20) days of receipt of PERFORMING PARTY's receipt of an audit report. At the same time, PERFORMING PARTY will also provide a statement containing an explanation of the conditions giving rise to each exception in the audit report as well as a plan for correction of any significant deficiencies in PERFORMING PARTY's operations or Agreement performance. TCEQ may approve the statement or reject as insufficient. At the option of the TCEQ, the PERFORMING PARTY may revise and resubmit. If the statement is initially or subsequently rejected by the TCEQ with no further opportunity to revise, the TCEQ may suspend payments or may terminate the Agreement for cause and may undertake any other remedies or sanctions provided under this Agreement. Hazardous Substances, Waste Disposal and Manifests 4.60 PERFORMING PARTY, subcontractors and subgrantees must comply with all applicable Laws and Regulations. Conflict of Interest 4.61 PERFORMING PARTY shall notify TCEQ immediately upon discovery of any potential or actual conflict of interest. PERFORMING PARTY agrees that TCEQ has sole discretion to determine whether a conflict exists and that TCEQ may terminate the Agreement at any time, on the grounds of actual or apparent conflict of interest. See paragraph 4.26 of these General Conditions concerning conflicts of interest with subgrantees, subcontractors and others. 4.62 Notice.of Conflict of Interest: The PERFORMING PARTY shall notify the TCEQ in writing of any actual, apparent,or potential conflict of interest regarding any individual performing or having access to information regarding the Work. As applicable,the notification shall include both organizational conflicts of interest and personal conflicts of interest. Any individual with a personal conflict of interest shall be disqualified from taking part in any way in the performance of any work that created the conflict of interest. Survival of Obligations: 4.63 All representations, indemnifications, warranties and guarantees made in,required by or given in accordance with the Agreement Documents, as well as all continuing obligations indicated in the Agreement Documents, will survive final payment, completion and acceptance of the Work and termination or completion of the Agreement. Interest and Unexpended Funds 4.64 Interest Earned on Grant Agreement Funds. If PERFORMING PARTY earns any interest from grant funds, then PERFORMING PARTY is required to handle interest earned from grant funds in the same manner and under the same conditions as the actual grant funds. This includes at a minimum,describing the expenditure of the interest funds in the plan and budget of PERFORMING PARTY submitted to the TCEQ, and reporting the actual use of that interest to the TCEQ on the financial reports required under the new grant agreement. Any interest earned under this Agreement must be expended within state fiscal year 2002. Any remaining interest earned under this Agreement which is not expended by August 31,2003, shall be returned to the TCEQ within one hundred and twenty(120)days following the end of fiscal year 2002 unless TCEQ authorizes an alternative. TCEQ SFG Agreement. Contract No.582-4-64434 Page 44 June 19,2003 4.65 Unexpended funds and Interest Remaining at Termination.The PERFORMING PARTY shall, not later than one hundred and twenty (120) days following termination of this Agreement, or thirty (3 0) days following submittal of the final Financial Status Report,whichever is earlier,return to the TCEQ any unexpended disbursements and/or reimbursements remaining in any accounts containing such funds. By not later than the same date,the PERFORMING PARTY, unless authorized otherwise in writing by the TCEQ, shall return to the TCEQ any remaining interest earned, in excess of one hundred dollars($100). Amounts of earned interest less than one hundred dollars ($100) may be retained by the PERFORMING PARTY for administration expenses. ARTICLE 5. TCEQ'S RESPONSIBILITIES 5.1 Except as otherwise provided in these General Conditions,TCEQ shall issue all communications regarding the Agreement to PERFORMING PARTY through the TCEQ Contract Manager or their representative. All technical instructions and data shall be issued through the TCEQ Project Manager or their representative. 5.2 TCEQ shall furnish any data required of TCEQ under the Agreement Documents promptly and shall make payments to PERFORMING PARTY pursuant to the Agreement Documents. 5.3 The Agreement Documents and the Uniform Grant Management Standards contain provisions that provide for withholding of payment as well as suspension and termination of the Agreement by the TCEQ. 5.4 The TCEQ shall not supervise, direct or have control or authority over,nor be responsible for, PERFORMING PARTY's means, methods,techniques, sequences or procedures of performing the Work or the Safety precautions and programs incident thereto, or for any failure of PERFORMING PARTY to comply with Laws and Regulations applicable to the furnishing or performance of the Work. TCEQ will not be responsible for PERFORMING PARTY's failure to perform or furnish the Work in accordance with the Agreement Documents. ARTICLE 6. CHANGES IN THE WORK 6.1 A Major Change will include one or more of the following: 6.1.1 an increase in the total amount of compensation that can be earned under the agreement ; 6.1.2 an extension or shortening of the term of the Agreement; 6.1.3 a change in the scope of the Agreement or the services to be performed; or 6.1.4 any action that is beyond the authority of the Project Field Representative of the TCEQ. 6.2 Implementation of a major change must be preceded by a formal written amendment to the Agreement. The amendment must contain a description of the proposed change. The amendment must be signed by persons authorized to bind each party in Agreement. 6.3 Any proposed change that is not a Major Change may qualify as a Minor Change. In addition, a delay or change in the Work resulting from inclement weather will be treated as a Minor Change. A Minor Change does not require a formal amendment to the Agreement. At his or her discretion, the Project Field Representative of the TCEQ may require the PERFORMING PARTY to submit a written request for the change and a description of the activity or action proposed, or may give the PERFORMING PARTY verbal approval for the change. In either case,no authorization shall be effective unless it is followed by a letter from the Project Field Representative of the TCEQ ratifying the authorization. A copy of the letter must be retained in the appropriate file of both the PERFORMING PARTY and the TCEQ. 6.4 If the PERFORMING PARTY requests a Minor Change and the Project Field Representative of the TCEQ does not approve the request as a Minor Change,then the change shall be deemed a Major Change and the PERFORMING PARTY may only obtain authorization to proceed in accordance with Section 6.2 of this Article. Waiver 6.5 Unless authorized in accordance with these Agreement Documents (relating to Changes), or in writing by the TCEQ,no waiver of any obligation of the PERFORMING PARTY under this Agreement shall bind the TCEQ. TCEQ SFG Agreement. Contract No.582-4-64434 Page 45 June 19,2003 Furthermore,unless specified in the written authorization, the authorized waiver by the TCEQ of such obligation shall not constitute a continuing waiver of the obligation. No waiver by the TCEQ Executive Director shall constitute a waiver of the TCEQ's subsequent right to demand and receive performance within a reasonable time to be specified by the TCEQ, in accordance with all provisions of this Agreement. ARTICLE 7. PAYMENTS TO PERFORMING PARTY Payment based on Reimbursement of Actual Cost of Performance 7.1 Allowable Costs. Payments from the TCEQ to the PERFORMING PARTY are for reimbursement of PERFORMING PARTY's actual allowable costs of PERFORMING PARTY's performance. Actual costs include reasonable and necessary direct and indirect costs. Allowable costs are those deemed allowable by the TCEQ in accordance with the requirements of this Agreement and the following which are hereby incorporated into this Agreement: 7.1.1 Uniform Grant Management Standards prepared and promulgated by the office of the Governor of Texas; 7.1.2 Rules and guidelines of the office of the Governor of Texas 7.1.3 Allowable Expenditure Guidelines of the TCEQ 7.1.4 Applicable rules and policies of the TCEQ 7.1.5 Applicable State law 7.1.6 For funds received from a federal government source, applicable federal regulations and law. Payments by TCEQ 7.2 PERFORMING PARTY must request payment by submitting one copy of an itemized invoice in a format provided by the TCEQ (Form B-3), a properly completed TCEQ PURCHASE VOUCHER(Form B-2), and such other forms as the TCEQ requires. PERFORMING PARTY will also submit any supporting documentation required by TCEQ. TCEQ will review the submittal and approve or reject the request for payment. PERFORMING PARTY must make any revisions required by the TCEQ in order to gain approval. TCEQ is not obligated to make payment until the request for payment is approved by TCEQ. Fixed-Amount Cost Reimbursement 7.3 In accordance with Chapter 2259 Texas Government Code, all payments by TCEQ to PERFORMING PARTY are based on reimbursement of PERFORMING PARTY's actual costs incurred in performing the Work. If this Agreement utilizes a pre-determined fixed-amount of reimbursement,this amount is determined on the basis of an estimate of PERFORMING PARTY's actual costs of performing one or more of the following: 1) specified service(s)(tasks); or 2) specified service(s) (tasks) during a specified time period; or 3)providing specified good(s), or product. PERFORMING PARTY has provided the estimate of costs in its Fiscal Analysis Package (Form B-5) for this grant. The TCEQ relies on the accuracy of that estimate to determine the fixed- amount of reimbursement. PERFORMING PARTY will provide supporting evidence to establish the accuracy of its estimate of actual costs. PERFORMING PARTY will monitor its actual costs of performance and provide TCEQ with a report annually to confirm that the original estimate of costs remains accurate. If in fact that estimate exceeds the actual costs of performance,TCEQ may recover the excess amount paid by 1)rejecting all or part of any reimbursement requests by PERFORMING PARTY and retaining amounts sufficient for repayment; or 2)by demanding and receiving repayment of the amount from PERFORMING PARTY. TCEQ may also use any other remedies and sanctions available under this Agreement. Contractual Costs 7.4 PERFORMING PARTY's contractual costs must comply with allowable costs requirements. PERFORMING PARTIES which are governmental entities must engage in contractor selection on a competitive basis in accordance with their established policies. If PERFORMING PARTY has no competitive procurement policy or is a private entity, PERFORMING PARTY must generally select contractors by evaluation and comparison of price, quality of goods or services and past performance. TCEQ SFG Agreement. Contract No.582-4-64434 Page 46 June 19,2003 Comparison of Performing Party's Costs 7.5 In accordance with Section 2259.203 Texas Government Code, the TCEQ is required to perform a comparison of costs reimbursed under this Agreement. PERFORMING PARTY will provide a report to verify that its costs of performance are reasonably comparable to prices generally charged for similar goods or services. Indirect Cost Rate 7.6 If indirect costs are to be paid under this Agreement, PERFORMING PARTY shall also submit an indirect cost proposal and a copy of an approval document reflecting that the proposed indirect cost rate has been approved by a federal agency or a federally certified State or local agency. Duplication of Effort Prohibited 7.7 In addition to the funds provided to PERFORMING PARTY under this Grant Agreement, the TCEQ may provide funds to PERFORMING PARTY under a separate Grant Agreement(so that funds of two or more TCEQ grants are funding a single activity of PERFORMING PARTY). PERFORMING PARTY must monitor all activities to ensure that the grant funds complement one another and do not result in double payments for the same activity. Payment Request Procedures 7.8 On a quarterly basis, within thirty(30) days after the end of a quarter, the PERFORMING PARTY shall submit one copy of an itemized invoice in a format provided by the TCEQ(Form B-3) and a properly completed TCEQ PURCHASE VOUCHER(Form B-2), in order to obtain payment for tasks completed under this Agreement. Completed request for reimbursement packages should be mailed or delivered to the TCEQ Local Program Contact Manager identified in paragraph 9.8 of Article 9 of this Agreement(related to Notice). Concurrent with the submittal to the Local Program Contract Manager, a copy of the same documents shall be submitted to the TCEQ Project Field Representative identified in paragraph 9.8 of Article 9 of this Agreement (related to Notice). 7.9 The TCEQ Local Program Contact Manager will review the invoices and purchase vouchers for requests for payment for services performed as identified in Section 7.8 of this Article and as required in SCOPE OF WORK SECTION, and will provide written documentation to the PERFORMING PARTY and the TCEQ Project Field Representative that the requests are acceptable or will provide a written explanation of why the requests or the work identified in the requests is unacceptable. If the requests do not satisfactorily demonstrate the accomplish- ment of the required tasks,the TCEQ Local Program Contact Manager and TCEQ Project Field Representative will not authorize payment on the accompanying voucher until such time as deficiencies have been corrected. 7.10. TCEQ is not obligated to make payment until the request for reimbursement is approved by TCEQ. Further, the TCEQ reserves the right to suspend payment for any incomplete, inconsistent or incorrect services or reports as required by this Agreement until the PERFORMING PARTY satisfactorily completes,revises, or corrects such services or reports. Closeout 7.11 When it is determined that all applicable administrative activities and all required work of the grant have been completed, the TCEQ shall close out the award. Within thirty(30)days after the expiration or termination of the grant, the Performing Party must submit all financial,performance, and other reports required as a condition of the grant. These reports may include, but are not limited to: 7.11.1 All performance or progress reports required by this Agreement. 7.11.2 Financial Status Report(Form 134). 7.11.3 Final request for payment(including Forms B-1, B-2,B-3). 7.11.4 Invention disclosure (if applicable). 7.11.5 State-owned property report(if applicable). TCEQ SFG Agreement. Contract No.582-4-64434 Page 47 June 19,2003 7.12 In accordance with the Uniform Grant Management Standards , a PERFORMING PARTY must submit an inventory of all state-owned property (as distinct from property acquired with grant funds) for which it is accountable and request disposition instructions from the TCEQ of property no longer needed. 7.13 Within ninety(90)days of receipt of the reports set forth above, the TCEQ will make upward or downward adjustments to the allowable costs. The TCEQ agency will make prompt payment to the PERFORMING PARTY for allowable reimbursable costs. Closeout of the grant does not affect: 7.13.1 The TCEQ's right to disallow costs and recover funds on the basis of a later audit or other review; 7.13.2 The PERFORMING PARTY'S obligation to return any funds due as a result of later refunds, corrections,or other transactions; 7.13.3 Records retention as required herein; 7.13.4 Property management requirements set forth herein; and 7.13.5 Audit requirements set forth herein. 7.14 The PERFORMING PARTY must immediately refund to the TCEQ any balance of unobligated (unencumbered)cash advanced that is not authorized to be retained for use on other grant. 7.15 Any funds paid to a Performing Party in excess of the amount to which the Performing Party is finally determined to be entitled under the terms of the award constitute a debt to the TCEQ. If not paid within a reasonable period after demand, the TCEQ may reduce the debt by: 7.15.1 Making an administrative offset against other requests for reimbursement, 7.15.2 Withholding advance payments otherwise due to the PERFORMING PARTY,or 7.15.3 other action permitted by law. 7.16 Except where otherwise provided by statutes or regulations,the TCEQ will charge interest on an overdue debt in accordance with the Uniform Grant Management Standards. The date from which interest is computed is not extended by litigation or the filing of any form of appeal. 7.17 Upon satisfactory completion of the work performed hereunder and prior to final payment under this Agreement for such work,or prior to settlement upon termination of this Agreement and as a condition thereto, the PERFORMING PARTY shall execute and deliver to the TCEQ a release of all claims for payment of any funds due and payable by the TCEQ pursuant to the terms of this Agreement. Such release shall be conditioned upon payment of all fund amounts due and payable to PERFORMING PARTY under this Agreement, and limited to only those claims which reasonably could have been foreseen at the time the release is executed. PERFORMING PARTY reserves the right to identify claims to be excluded thereby. 7.18 The PERFORMING PARTY shall provide to the TCEQ documentation showing all tasks that have been completed by the PERFORMING PARTY. 7.19 Final Payment under this Agreement or settlement upon termination shall not constitute a waiver of the TCEQ's claims against the PERFORMING PARTY. Cost Provisions Applying Solely to Regional Planning Commissions and Councils of Government 7.20 The provisions of this Paragraph and Subparagraphs apply solely to Performing Parties, Subgrantees and other Recipients of the funds under this Grant Agreement defined as a"Regional Planning Commission"as defined in Chapter 391 of the Texas Local Government Code, which includes, among others,a Council of Government. In the event of conflict with other provisions of the Agreement Documents, the provisions of this Article prevail. 7.20.1 PERFORMING PARTY will comply with all requirements and rules to be adopted by the Office of the Governor of Texas pursuant to Section 391.009 Texas Local Government Code relating to the operation and oversight of Regional Planning Commissions. These rules are due for adoption on or about January 1, 2000. If those rules conflict with provisions of the Agreement Documents, the rules will prevail. 7.20.2 PERFORMING PARTY will comply with the requirement of Chapter 391 Texas Local Government TCEQ SFG Agreement. Contract No.582-4-64434 Page 48 June 19,2003 Code by adopting competitive procurement methods equivalent to Chapter 252 Texas Local Government Code for the purchase of all goods and services. PERFORMING PARTY will notify the TCEQ upon adoption of these methods. 7.20.3 PERFORMING PARTY will comply with all other requirements of Chapter 391 Texas Local Government Code with special attention to the following restrictions on the use of funds provided under this Agreement: 7.20.3.1 Contracts with or employment of lobbyists 7.20.3.2 Lobbying activities by employees 7.20.3.3 Auto allowance of members of the governing body 7.20.3.4 Travel reimbursements at the state rate 7.20.3.5 Alcoholic beverages and entertainment 7.20.3.6 Indirect cost rate limited to 15% of total direct expenditures 7.20.3.7 Classification salary schedules and appropriate exempt positions. 7.21 If indirect costs are to be paid under this Agreement, PERFORMING PARTY shall also submit an indirect cost proposal and a copy of an approval document reflecting that the proposed indirect cost rate and an analysis of the determination for the proposed indirect cost rate. ARTICLE 8. TERMINATION 8.1 This Agreement shall terminate upon full performance of all requirements contained herein, unless extended in writing. 8.2 This Agreement may be terminated in whole or in part by either party in the event of a material failure by the other party to comply with the Agreement terms,in accordance with the Uniform Grant Management Standards: Provided that no such termination may be effected unless the other party is given 8.2.1 not less than thirty(30) days written notice(delivered according to the notice requirements of this Agreement), and 8.2.2 an opportunity to cure with the terminating party prior to termination. 8.3 This Agreement may be terminated in whole or in part in writing by either party for its convenience, in accordance with the Uniform Grant Management Standards: Provided that the other party is given not less than thirty(30) days written notice (delivered according to the notice requirements of this Agreement) of intent to terminate. Circumstances in which the TCEQ may terminate for convenience include, but are not limited to,the Texas Legislature's withdrawal of appropriations for this project. 8.4 If either party terminates the Agreement for a material failure to comply with the Agreement terms under Section 8.2 or for convenience under Section 8.3, an adjustment in the Agreement amount shall be made in accordance with the Uniform Grant Management Standards. 8.5 Upon a termination action pursuant to Sections 8.2 or 8.3 above, the PERFORMING PARTY shall: 8.5.1 promptly discontinue all services affected (unless the notice directs otherwise), and 8.5.2 deliver or otherwise make available to the TCEQ all data, drawings, specifications, reports, estimates, summaries, and such other information and materials as may have been accumulated by the PERFORMING PARTY in performing this Agreement, whether completed or in the process. 8.6 If,after termination for failure of the PERFORMING PARTY to fulfill contractual obligations, it is determined that the PERFORMING PARTY had not so failed, the termination shall be deemed to have been effected for the convenience of the TCEQ. 8.7 If any delay or failure of performance is caused by a force majeure event as described in the force majeure Article of this Agreement,either party may in its discretion terminate this Agreement in whole or part pursuant to this Article. Force Majeure TCEQ SFG Agreement. Contract No.582-4-64434 Page 49 June 19,2003 8.8 A force majeure event shall be defined to include decrees of or restraints by a governmental instrumentality, acts of God (except that rain, wind, flood or other natural phenomena normally expected for the locality shall not be construed as an act of God), work stoppages due to labor disputes or strikes, fires, explosions, epidemics, riots, war,rebellion, and sabotage. 8.9 Provided this Agreement has not been terminated, and subject to the conditions below, if a delay or failure of performance by either party results from the occurrence of a force majeure event, the delay shall be excused and the time fixed for completion of the work extended by a period equivalent to the time lost because of the event if, and to the extent that: 8.9.1 the delay or failure was beyond the control of the party affected and not due to its fault or negligence; and 8.9.2 the delay or failure was not extended because of the affected party's failure to use all diligence to overcome the obstacle or to resume performance immediately after the obstacle was overcome. 8.10 No time extension shall be granted under this Article unless the party seeking relief has notified the other in writing within a reasonable time after commencement of the event, of the anticipated length and cause of the delay,the measures taken or to be taken to minimize the delay, and the timetable by which the PERFORMING PARTY intends to implement these measures. The party seeking relief shall also give written notice of the ending of the event within a reasonable time after the event has ended. 8.11 The TCEQ shall be responsible for costs related to a force majeure event only if they are incurred by the PERFORMING PARTY after the prior written request by the TCEQ Project Field Representative, to incur such costs in connection with any force majeure event. Neither the TCEQ nor the PERFORMING PARTY shall have, and both hereby waive, any claim whatever for any damages resulting from delays caused by force majeure events. ARTICLE 9. MISCELLANEOUS Computation of Times: 9.1 -When any period of time is referred to in the Agreement Documents by days, it will be computed to exclude the first and include the last day of such period. If the last day of any such period falls on a Saturday,or Sunday or on a federal holiday, such day will be omitted from the computation. 9.2 A calendar day of twenty-four(24)hours measured from midnight to the next midnight will constitute a day. 9.3 A working day is any day that both the TCEQ and the PERFORMING PARTY are open for business. Notice of Claim: 9.4 Should TCEQ or PERFORMING PARTY suffer injury or damage to person or property because of any error, omission or act of the other party or of any of the other party's employees or agents or others for whose acts the other party is legally liable, claim will be made in writing to the other party within a reasonable time of the first observance of such injury or damage. The provisions of this paragraph shall not be construed as a substitute for or a waiver of the provisions of any applicable statute of limitations or repose or sovereign immunity. Professional Fees and Court Costs Included: 9.5 Whenever reference is made to "claims,costs, losses, and damages," it shall include in each case,but not be limited to,all fees and charges of TCEQ, architects,attorneys and other professionals and all court or other dispute resolution costs. Acknowledgment of Financial Support 9.6 The PERFORMING PARTY shall acknowledge the financial support of the TCEQ and the State of Texas whenever work funded, in whole or part,by this Agreement is publicized or reported in news media or TCEQ SFG Agreement. Contract No.582-4-64434 Page 50 June 19,2003 publications. All reports and other documents completed as a part of this Agreement, other than documents prepared exclusively for internal use within the TCEQ, shall carry the following notation on the front cover or title page: PREPARED IN COOPERATION WITH THE TEXAS COMMISSION ON ENVIRONMENTAL QUALITY The preparation of this report was financed through grants from the State of Texas through the Texas Commission on Environmental Quality. ARTICLE 10. INSURANCE,LIABILITY AND INDEMNIFICATION 10.1 To the extent permitted bylaw, the PERFORMING PARTY agrees to indemnify and hold harmless the TCEQ and all of its employees and officers against and from any and all liability, loss, or damage arising out of the performance of this Agreement. To the extent that any activity conducted by PERFORMING PARTY with funds provided under this Agreement entails significant risk of loss or injury to individuals and third parties or their property, the PERFORMING PARTY will secure and maintain insurance sufficient to protect PERFORMING PARTY and the TCEQ,and its employees and officers against claims arising from the conduct of such activities. 10.2 In all subcontracts and subgrants,PERFORMING PARTY shall require its subcontractors and subgrantees to obtain and maintain, at their own expense, insurance as will protect the subcontractor, the PERFORMING PARTY and the TCEQ, its employees, and its officers from all such claims arising from the performance by the PERFORMING PARTY's subcontractors or subcontractors' employees resulting from the functions and services required under this Agreement, including workers compensation in accordance with Texas statutory requirements. Directors and Officers Insurance Coverage 10.3 PERFORMING PARTY will purchase and maintain Directors and Officers insurance or equivalent insurance coverage or other financial assurance sufficient to protect the interests of the state in the event of an actionable actor or omission by a director or officer of the PERFORMING PARTY. Within ten(10) days of the Effective Date of this Agreement, PERFORMING PARTY will submit evidence of insurance on a certificate to be provided by the TCEQ. ARTICLE 11. STANDARDS FOR PERFORMING PARTY'S PERFORMANCE 11.1 In accordance with Chapter 2259 Texas Government Code, the TCEQ is required to monitor PERFORMING PARTY's performance under this Agreement. Therefore,PERFORMING PARTY agrees that the following are appropriate standards for PERFORMING PARTY's performance during the Agreement: 11.1.1 Timeliness of Work. Standard: Work is provided on schedule. 11.1.2 Quality and Accuracy of Work. Standard: PERFORMING PARTY's Work is technically accurate and conforms to all Agreement requirements, including the compliance and enforcement standard operating procedures, capabilities, and reporting(including direct data entry)in support of the contracted Scope of Work(Deliverables)activities according to the TCEQ Air and Stage II Exhibits and guidance documents in this Agreement. 11.1.3 Subcontract Activities. Standard: PERFORMING PARTY's subcontract and subgrant activities comply with all TCEQ Agreement requirements regarding subcontracts especially competitive procurement methods for goods and services,use of required subcontract provisions, and monitoring performance of subcontractors and subgrantees. 11.1.4 Administrative and Financial Operations. Standard: PERFORMING PARTY'S administrative and financial operations comply with all obligations in law and in the Agreement especially reports, record-keeping,reimbursement requests,audits, allowable costs, and restricted expenditures. Performance Measures TCEQ S)a G Agreement. Contract No.582-4-64434 Page 51 June 19,2003 11.2 TCEQ will monitor PERFORMING PARTY 's performance and evaluate the level of compliance with the standards utilizing the following performance measures: 11.2.1 Exemplary: PERFORMING PARTY generally complied with the standard consistently with specific instances of outstanding performance of work,either through providing exceptional customer service,providing suggestions on improvement of the program and work, or performing in such a manner that the efficacy of the work was substantially improved over the standards. Occasional deficiencies may have occurred which were corrected on a timely basis. 11.2.2 Satisfactory: PERFORMING PARTY generally complied with the standard consistently; occasional deficiencies may have occurred which were corrected on a timely basis. 11.2.3 Unsatisfactory: Significant deficiencies have occurred,or PERFORMING PARTY frequently or substantially failed to comply with the standard. Agreement Monitoring and Evaluation Report 11.3 In accordance with Chapter 2259 Texas Government Code,TCEQ will monitor and evaluate PERFORMING PARTY's performance utilizing the performance standards and performance measures set out in this Agreement.TCEQ will prepare a cumulative written report of the evaluation upon termination or expiration of the Agreement and also as frequently as determined appropriate by the TCEQ. 11.3.1 Within thirty(30) days of receipt of a Periodic or Annual Performance Evaluation, the PERFORMING PARTY shall provide information to the TCEQ concerning action(s) that will be taken to correct any deficiencies noted in the Performance Evaluation report. This response will include a schedule to bring any deficiencies in the program activities up to TCEQ standards and will identify resources to accomplish necessary corrections. 11.3.2 Within ninety (90) days after receipt of TCEQ comments or as recommended by the TCEQ,the PERFORMING PARTY shall correct deficiencies and report to the TCEQ any deficiencies that cannot be corrected within the 90 day time frame. Schedule of Remedies available to the TCEQ 11.4 In accordance with Chapter 2259 Texas Government Code,the following Schedule of Remedies applies to this Agreement in the event of substandard performance or other failure to conform to the requirements of the Agreement or applicable law. 11.4.1 Reject substandard performance and request corrections without charge to the TCEQ. 11.4.2 Issue notice of substandard performance or other non-conforming act or omission. 11.4.3 Request and receive return of any over payments or inappropriate payments. 11.4.4 Reject reimbursement request and suspend payment pending accepted revision of substandard performance or non-conformity. 11.4.5 Suspend all or part of the Work and/or payments pending accepted revision of substandard performance or non-conformity. 11.4.6 Reject reimbursement request and withhold all or partial payments.Funds may be retained by the TCEQ for recovery of administrative costs or returned to funding source as authorized by agreements with the funding source and by state or federal law. 11.4.7 Terminate the Agreement, demand and receive: return of all equipment purchased of Agreement funds,return of all unexpended funds, and repayment of expended funds. 11.4.8 Withhold payment to the PERFORMING PARTY for future air program activities and/or result in the PERFORMING PARTY becoming ineligible for future funding. Sanctions for Substandard Performance 11.5 If the TCEQ evaluation finds PERFORMING PARTY's performance to be substandard,TCEQ may provide its written evaluation report to other governmental entities at any time. TCEQ may also provide its written evaluation report to the public as authorized by law. Cumulative Remedies 11.6 The TCEQ may avail itself of any remedy or sanction provided in this Agreement or in law to recover any TCEQ SFG Agreement. Contract No.582-4-64434 Page 52 June 19,2003 losses rising from or caused by the PERFORMING PARTY's substandard performance or any non-conformity with the Agreement or the law. The remedies and sanctions available to TCEQ in this Agreement shall not limit the remedies available to the TCEQ under law. 11.7 The duties and obligations imposed by these General Conditions and the rights and remedies available hereunder to the parties hereto,and, in particular but without limitation, the Schedule of Remedies, obligations imposed upon PERFORMING PARTY by these General Conditions,and all other rights and remedies available to TCEQ thereunder, are in addition to, and are not to be construed in any way as a limitation of, any rights and remedies available to any or all of them which are otherwise imposed or available,by Laws or Regulations,by special warranty or guarantee or by other provisions of the Agreement Documents, and the provisions of this paragraph will be as effective as if repeated specifically in the Agreement Documents in connection with each particular duty,obligation,right and remedy to which they apply. END OF GENERAL CONDITIONS TCEQ SFG Agreement. 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Authorize the City Manager to execute an agreement with the Texas Commission on Environmental Quality (TCEQ) in the amount of $274,550 per year for air pollution control services. The agreement term is for the two-year period from September 1, 2003, through August 31, 2005; and 2. Authorize a non-interest bearing inter-fund loan from the Environmental Management Operating Fund to the Grants Fund in the amount of $68,638 for interim financing for this grant pending contract execution; and 3. Authorize the use of $135,226 per year from the General Fund as an in-kind match for this contract; and 4. Adopt the attached appropriation ordinance increasing estimated receipts and appropriations in the Grants Fund by $819,552, subject to receipt of an executed contract; and 5. Apply indirect costs at the most recently approved rate of 20.59% for the Environmental Management Department not to exceed $56,530 per year, which is included in the annual grant amount of $274,550. DISCUSSION: Since FY1991-1992, the City has entered into an annual contract with the TCEQ for the City to provide certain air pollution control services within Fort Worth. The services provided include complaint investigation, new source review and comment, annual inspections at Volatile Organic Compound (VOC) sources, used car emissions inspections, and Stage II Vapor Recovery System inspections at area gas stations. The City must provide matching funds such that the combined federal and state share of the total funding for the City of Fort Worth Air Pollution Control Program shall not exceed 67%. The matching funds must be allocated per maintenance of effort requirements for federal air pollution grants. A portion of the $246,987 Air Quality Section budget proposed for FY2003-2004 will be used as the required in-kind match. Upon approval and acceptance of the grant, City funds will be expended before receipt of grant funds. City of Fort Worth, Texas "Agar And Council Communication DATE REFERENCE NUMBER � LOGNAME PAGE 8/19/03 C-19724 52STATECONTRACT 2 of 2 SUBJECT APPROVAL OF CONTRACT WITH THE TEXAS COMMISSION ON ENVIRONMENTAL QUALITY FOR FY2003-2005 SERVICES FISCAL INFORMATION/CERTIFICATION: The Finance Director certifies that upon approval of the above recommendations, adoption of the attached appropriation ordinance, and execution of a contract, funds will be available in the current operating budget, as appropriated, of the Grants Fund. Upon execution of the grant contract, the inter- fund loan of$68,638 will be returned to the Environmental Management Operating Fund. LW:k Submitted for City Manager's FUND ACCOUNT CENTER AMOUNT CITY SECRETARY Office by: (to) GR76 220103 000412876000 $ 68,638.00 Libby Watson 6183 GR76 488279 013412876000 $270,452.00 Originating Department Head: GR76 451543 052412876000 $549,100.00 GR76 5 (various) 052412876010 $549,100.00 GR76 517040 052412876020 $270,452.00 Brian Boerner 8079 (from) APPROVED 08/19/03 R103 136076 0000000 $ 68,638.00 ORD.4 15650 Additional Information Contact: Brian Boerner 8079