012.02.01 Ark. Code R. 004

Current through Register Vol. 49, No. 10, October, 2024

Rule 012.02.01-004 - Revisions to the Manual for the County Courthouse Restoration Grant (CCRG) Program

I. GENERAL INFORMATION

Purpose

The Arkansas Historic Preservation Program (AHPP) recognizes a lack of financial assistance as one of the largest obstacles to the preservation of historic resources in Arkansas. The purpose of the County Courthouse Restoration Grant program is to encourage and promote the preservation and continued use of Arkansas's historic courthouses by providing financial assistance for restoration, selected maintenance and accessibility projects. The County Courthouse Restoration Grant is an annual grant that has been in existence since 1988. It is funded primarily by an annual grant to the AHPP by the Arkansas Natural and Cultural Resources Council (ANCRC) using Real Estate Transfer Tax funds. Fifty-four of the sixty-four Arkansas counties with eligible courthouses have received grants from the AHPP.

Funding Source

Grants awarded by the Arkansas Historic Preservation Program (AHPP) are funded by General Revenues of the State of Arkansas and Special Revenues under the Real Estate Transfer Tax passed as Acts 729 and 818 of 1987, the Arkansas Conservation Tax established by Amendment 75, or by the National Park Service, United States Department of the Interior. All grant recipients must follow the policies and procedures of the Arkansas Historic Preservation Program, as well as regulations governing the expenditure of ail state and federal funds. The regulations set forth in this manual must be strictly adhered to by both the Arkansas Historic Preservation Program and by all grant recipients.

State and Federal Regulations

All grant recipients must agree to abide by and comply with applicable state and federal regulations and policies, including Fair Labor Standards, Title VI of the Civil Rights Act of 1964 [ 42 USC 2000(d) ] and Section 504 of the Rehabilitation Act of 1973 [ 29 USC Section 794], Title IX of the Education Amendment of 1973, and the Americans with Disabilities Act of 1991, as well as all other applicable state and federal laws, regulations, and executive orders.

II. GRANTS AND ELIGIBLE PROPERTIES

Eligibility

Eligible county courthouses include 1) those listed on the National Register of Historic Places, either individually or as a contributing resource in a historic district; and 2) those that are not listed, but are eligible for listing on the National Register, as determined by AHPP. A county receiving grant funds for a non-National Register courthouse must submit a completed National Register nomination with its final invoice.

Authorized Uses of County Courthouse Restoration Grants

County Courthouse Restoration Grants may be used to preserve, restore, rehabilitate, repair, or stabilize county courthouses listed on the National Register of Historic Places. Highest priority is assigned to projects mitigating a threat to a structure's integrity and survival. Grants cannotbe used to reimburse expenses for work done outside the grant period specified in the grant contract. Additionally, it should be stressed that these grants are not intended for general maintenance projects. Grants may be used for, but are not limited to, the following projects:

- Repair and/or replacement of roofing materials.

- Repair and/or replication of original windows.

- Repair and/or replication of original exterior siding material.

- Removal of artificial siding (vinyl, metal, asbestos plate).

- Repair of foundation and/or masonry problems.

- Repair or replication of significant exterior architectural elements such as missing or securely dilapidated/missing columns, turrets, cupolas, domes, or clock towers.

- Exterior painting (if existing paint has failed).

- Exterior cleaning.

- Repair of integral guttering systems.

- Repair of structural elements such as floor joist, ceiling joists, rafters, foundations, rotted floors, load-bearing walls, trusses, metal columns or beams.

- Removal of asbestos or lead paint.

- Alterations to meet requirements of the federal Americans with Disabilities Act of 1991.

- Repair and/or installation of seismic reinforcement in a historic structure.

- Repair, restoration, or replication of missing or deteriorated original interior features considered significant to the National Register eligibility of the property. The features must be documented through historic photographs, original architectural drawings/specification, or architectural investigation. Projects may include but are nor limited to the following items: decorative plaster work, murals, stencils, faux finishes, decorative painting, carved/decorative moldings and trim, wood paneling, fireplace mantels, staircases, stained-glass windows/skylights, parquet flooring, and the repair of mechanical, plumbing, and electrical systems if the existing systems jeopardize the historic property.

III. PREPARING THE GRANT APPLICATION

Planning the Project

An applicant for any County Courthouse Restoration Grant must first determine the scope of the project to be funded. Historic preservation is an expensive endeavor, and most projects require careful prioritization. Tips on developing a good project include:

- Ask an expert. An architect can be invaluable in helping you to determine your needs and planning your project. In addition to giving an estimate of the project cost, an architect can also provide information on structural priorities and efficient scheduling. Also, feel free to contact the Historic Preservation Program if you have questions regarding project funding priorities or guidelines for rehabilitation.

- Phase it out. Funds for Courthouse Restoration Grants are often limited, and few applicants receive the total amount requested in their application. By dividing the project into prioritized phases, you provide a way for funding to be used effectively even if you don't get everything you requested. You can apply for more funding in the next grant cycle.

- Know your limitations. Or maybe we should say, "Don't bite off more than you can chew." Administering a grant project requires staff time and attention to detail. Don't commit yourself or your county to a project if you are unable to invest the necessary resources to complete it. By the same token, don't commit the county to a cash match or other investment of scarce resources unless you can be sure it will be in place when you sign the grant contract.

Application Packet Format

The County Courthouse Restoration Grant application packet should be organized using the following format, with sections numbered accordingly:

1.Application:A two-page document, mailed to the applicant with this booklet, containing basic information on applicant and the proposed project. Includes space for a brief (2-3 sentence) summary of the project.

2.Detailed Project Description:Drawings and narrative explaining how the project is to be accomplished, what materials will be used, and timeline for project. Narrative should include specific explanation of what project components will be funded by the grant.

3.Color Photographs of Property:Color prints of north, south, east, and west elevations of the building, along with close-up color prints of any work that is to be funded with the grant. FAILURE TO SEND COLOR PRINTS WILL RESULT IN AUTOMATIC DISQUALIFICATION FOR THE APPLICATION. SCANNED OR DIGITAL IMAGES, BLACK AND WHITE PRINTS, OR SLIDES WILL NOT BE ACCEPTED.

4.Detailed Project Budget:A line-item project budget, including material costs, labor, and architect/consultant fees. A detailed estimate written by the architect is acceptable. Budget should also specify which items are to be grant-funded.

5.Letter of Agreement for Easement:If a county applies for funds to restore a courthouse on which AHPP does not hold an easement, the application must include a letter from the county judge stating that he/she has read the section of this booklet entitled "Conservation Easements" and understands that no grant funds will be released until a Deed of Conservation Easement has been conveyed to AHPP and filed with the circuit or county clerk.

6.Letters of Commitment and Support:Letters from project stakeholders (friends groups, other local government officials, donors, or volunteers) demonstrating community and/or financial support for the project.

IV. AHPP GRANT REVIEW PROCESS

Staff Review

Grants are awarded annually. The technical staff of the AHPP reviews applications for completeness and project eligibility. The staff scores technical aspects of a project on a scale of 1 to 200 using a standard rating sheet (see Exhibit 1). The staff forwards the completed rating sheet and any additional recommendations to the Historic Preservation Grants Selection Committee, consisting of the following members:

1) Director of the Arkansas Historic Preservation Program;

2) the Chairman of the State Historic Preservation Review Board, or another Board member designated by the Chairman; and

3)a Constituent at Large designated by the State Historic Preservation Officer.

Selection Criteria

The Grants Selection Committee uses the following primary criteria to evaluate Courthouse Restoration Grant applications:

- Staff recommendations and technical scoring.

- Threats to property or possibility of imminent loss.

- Historic significance of property.

- Impact of project on community preservation.

- Conformity to community planning standards.

- Evidence that the objectives of the project can be achieved within the framework set forth by the applicant.

- Qualifications and experience of the applicant and contractors participating in the project.

- Interest of the applicant in undertaking the project and acquired benefits to the applicant and to the AHPP.

- Appropriateness of the budget and evidenced support for matching funds.

- Timeliness, need, and significance of the project.

- Number of other grant recipients in geographic region.

- Completeness of application. Incomplete applications will not be considered.

V. ADMINISTERING THE GRANT

Notification

A notification letter from the Governor of Arkansas will be sent to all counties receiving Courthouse Restoration Grant funding.

Required Workshop

Grantees must attend a grant administration workshop in Little Rock at a time and location specified by the AHPP. Attendance is MANDATORY for the grant recipient or the project manager. FAILURE TO ATTEND THE GRANT ADMINISTRATION WORKSHOP WILL RESULT IN CANCELLATION OF THE GRANT AWARD.

Grant Contract

Each grantee must sign a contract with the AHPP and comply with all of its terms. The contract is included in the grant award packet.

Conservation Easement

Each recipient of a County Courthouse Restoration Grants must convey a Deed of Conservation Easement to the AHPP priorto the receipt of any grant funds. An easement is a voluntary transfer of some of the rights inherent in property ownership. The historic preservation easement is a right or limitation, set forth in a legal instrument or deed, which allows the donor to retain ownership and possession of a historic landmark while granting a government agency or qualified non-profit organization the authority to protect the historic, cultural, architectural, or archeological characteristics of the property.

The agreement may be called a "preservation," "conservation," "scenic," "interior," "open space," "exterior," or "facade" easement. The name has less to do with the way the agreement works than with the kind of resource it protects.

In each instance, the "easement," as it is legally termed, must contain binding and enforceable covenants that run with the land and structure. These covenants obligate the owner to refrain from actions that are incompatible with the preservation of and/or the historic integrity of the property. The Deed of Conservation Easement document must be executed in accordance with AHPP'S conservation easement program procedures.

Project Technical Review

All grant-supported projects must be in accordance with the Secretary of the Interior's Standards for Rehabilitation and Guidelines for Rehabilitating Historic Buildings. A copy of these standards is included in the award packet. Before any grant-assisted work is done, the AHPP must review the plans and specifications of the project to ensure compliance with these standards.

Project Time Limits

Unless otherwise authorized, all projects must be completed within the time period specified in the grant contract. A grantee that is unable to meet a project deadline is required to submit a written request for an extension of time at least 14 days prior to the deadline. This request will be reviewed by the AHPP, and the grantee will be notified as soon as possible of the action taken. A request for an extension does not guarantee it will be granted. If the grantee does not meet the established deadline and/or does not request and receive an extension, the grant will be terminated on the contract end date and funds will be reallocated. A grantee who encounters serious financial problems after accepting a grant, or who is for some other reason unable to proceed with the project, should immediately inform the AHPP. The funds will then be reassigned or returned to the AHPP according to the procedures specified in this manual.

Project Review/Approval

When preparation for the project is complete, the grantee must forward project plans and specifications to the AHPP staff before work starts. Failure to do so will result in denial of grant funds. If clarification or additional information is required, the AHPP staff will contact the grantee. AHPP staff will conduct a final review of all project plans and required documents. When all is in order, the AHPP Director will provide written authorization for work to begin. Work may not begin until the grantee receives this project initiation letter.

AHPP staff members may inspect the project before, during, and after the completion of the work. Once work has begun, the site visits may be made without notification to the grantee. An AHPP photographer may photograph the project.

The grantee and/or the project architect are encouraged to contact the AHPP with questions at any time before or during work on the project. No changes in the project can be made after AHPP gives final approval to the plans unless such changes are submitted in writing to AHPP and approved in writing by the AHPP beforehand. If changes are not approved, final work may not be approved and full funding for the project could be denied. In the event of unforeseen problems, the AHPP staff will work to find a solution satisfactory to both the grantee and the AHPP.

Allowable Expenses

To be considered allowable, all costs must appear in the approved work-cost breakdown. Some of the most frequently used allowable costs include:

- Historical, architectural, or archeological research necessary to implement and carry out project work.

- Architectural, engineering, or contractor fees necessary to implement and carry out project work.

- Expendable supplies and materials.

- Rental or lease of project equipment.

- Exterior restoration.

- Structural repairs.

Non-allowable Expenses

The following costs are not reimbursed by County Courthouse Restoration Grants:

- Any item not listed in the approved work-cost breakdown.

- Deficits.

- Contingency funds.

- Contributions or donations to other organizations or individuals.

- Capital expenditures defined as tangible property costing $100 or more and having a life span of two or more years.

- Entertainment expenses, including refreshments, flowers, reception costs, etc.

- Interest and other financial costs.

- Lobbying expenses.

- New construction (some exceptions apply).

- Interpretive expenses (some exceptions apply).

- New pavement of parking lots, roads or walkways (some exceptions apply).

- Furnishings, draperies or carpeting.

- Work done prior to grant award.

Grant Payments

Since grants are based on anticipated federal funds or state revenues and not on existing funds, grant amounts could be reduced at any time during the grant period.

The schedule of grant payments will depend upon the nature of the project. Grant payments will be made directly to the grantee. No payment will be made to the grantee unless payment requests are accompanied by progress or final reports as applicable. The grantee should use the following procedures:

1. No payment shall be made under this grant agreement until recipient has made a cash match expenditure at least equal to the payment requested.

2. One of the following payment options can be used:

a. Partial reimbursement payments upon completion of portions of the project (no more than four requests during grant period);

b. One full payment upon completion of the total project.

3. Requests for partial reimbursement payments must include:

a. AHPP progress report/invoice form.

b. Vendor invoice (s).

4. Final payment will be processed upon approval of completed work. Request for final payment must include:

a. AHPP final report/invoice form

b. Vendor invoice (s).

c. Color photographs of completed project.

A blank AHPP invoice form, progress report form, and final project report form are included in the grant award packet. Please make copies as needed.

Financial Records

All finance records shall be made available for audit. Records should be kept on file by the grantee for at least three years after completion of project.

Reporting

Grantees are required to submit reports during the grant period according to the grant agreement. Progress reports are required at least quarterly and must accompany any partial payment request. A final project report is required no later than 30 days after completion of the project. This report must include certification/documentation of cash match and total project costs. Full or final payment requests must be accompanied by the final project report. A county receiving grant funds for a non-National Register courthouse must submit a completed National Register nomination with its final invoice.

Reassignment of Funds

Occasionally during the course of the annual grant cycle AHPP identifies additional funds available for Courthouse Restoration grants. These funds usually result from a grantee's decision to decline a grant award. The Historic Preservation Grant Selection Committee will meet to determine the reassignment of any unused grant funds previously awarded. The funds may be awarded to another qualified applicant with a current grant proposal on file, or they can be applied to an emergency grant in a case where a historic courthouse is in imminent danger due to storm damage or other unforeseen disaster. The Grant Selection Committee will use the same criteria to reassign these midterm funds that are used to award the initial grants.

Executive Order 98-04

All work performed with AHPP grant funds must comply with the terms of EO-98-04 (see Exhibit 2).

VI. PROJECT CONTRACTING PROCEDURES

Selection of an Architect

Recipients of County Courthouse Restoration Grants are required to use the services of an architect licensed by the State of Arkansas. The architect will prepare plans, specifications, a work-cost breakdown, and other required contract documents, for submission to the AHPP, and will supervise the project. This requirement may be waived by the AHPP under certain circumstances. Procedures for selection of an architect are contained in Act 616 of 1989 of the State of Arkansas and should be reviewed. The major provisions of the selection process are stated here:

1. Competitive bidding for procurement of architectural services is prohibited.

2. Contracts for architectural services shall be negotiated on the basis of demonstrated competence and qualifications.

3. Select three (3) qualified firms based on such criteria as:

a. specialized experience and technical competence;

b. ability to work within required time limitations;

c. past record; and

d. proximity to and familiarity with the project.

4. Negotiate a satisfactory contract with the most qualified firm. (See Section 5 of Act 616 for more details on the negotiating process.)

The architect selected by the grantee is encouraged to meet with the Arkansas Historic Preservation Program staff to discuss the project in detail.

Selection of a Contractor

Procedures for selecting a contractor and requirements for contractors are contained in Act 159 of 1949 as amended and should be reviewed. The major provisions of Act 159 are:

Contractor License Requirement

1. Contractors must be licensed by the Arkansas Contractors Licensing Board on projects of $10,000 or more. Contractors shall indicate their current license number on their bid forms.

2. On projects of less than $10,000, licensed contractors are not required, although the AHPP highly recommends licensed contractors for all projects.

3. On projects of $50,000 or more, the genera! contractor must list any roofing, plumbing, electrical and HVAC subcontractors and these subcontractors must be licensed by the Arkansas Contractors Licensing Board.

Contractor Insurance and Bonding Requirements

1. All contractors must carry construction liability and workers compensation insurance regardless of the cost of the project.

2. On projects of $10,000 to $19,999, contractors must furnish a 5% bid bond.

3. On projects of $20,000 or more, contractors must furnish a 5% bid bond and a 100% performance bond.

4. Bonds shall be written in favor of the grantee. After approval by the architect, the contractor shall file the bond with the Circuit Clerk and Recorder of the county where the work is to be performed. Contractor shall obtain from the Circuit Clerk certificates as evidence that the bond has been approved and filed with the Clerk and said certificates shall be filed with the architect. The contractor shall file the premium for the required bond. The contractor must obtain the bond before the contract between the owner and the contractor can be put into effect.

5. Insurance and bonding agents must be licensed and authorized to do business in Arkansas.

Bid Procedures

Most grantees funded by this grant program must use competitive bidding to purchase goods, services, materials, and labor. Competitive sealed bidding is required for the purchase of any construction-related goods and services of $10,000.01 or more. All procurement of construction-related products and services from $1,000.01 to $10,000.01 shall be done by soliciting competitive quote bids by telephone or in writing from at least three qualified vendors.

Project Specifications

Project specifications MUST contain the following statement:

"The Contractor is cautioned that this project involves largely RESTORATION WORK and maintaining the building in its present form is of utmost importance. The contractor shall use construction procedures calculated to protect the building. Any damage shall be repaired or replaced to present condition or better at no cost to the owner. This project involves state funds and carries the resultant obligations and restrictions."

Invitation to Bid

For projects costing more than $10,000.00, the grantee must seek bids by placing an advertisement once each week for at least two consecutive weeks in a publication that has general circulation in the county where the work is to be performed. Bid date must be at least one week following last advertisement. The grantee may also use additional advertising sources.

If a bid bond is required, the amount may be stated as a percentage. If the contract does not require a performance bond, the bid bond will be held until final acceptance and completion of the contract by payment in full. The advertisement shall state that the advertiser reserves the right to waive any formalities or reject any or all bids, as well as any other pertinent facts or information which may be necessary. The advertisement shall include a general description of the goods or services to be procured; shall state where bid documents may be obtained; shall state the date, time, and place of bid opening; and shall inform bidders that state funds are being used, and that relevant regulations, restrictions and applicable laws apply.

If, having advertised for bids, no bids are received by the date of the bid closing, the grantee must advertise for the goods and/or services to be procured a second time, with a second bid closing date established in accordance with these regulations.

Bids shall be opened- at the time and place designated in the public notices and the invitation for bid. When practical, the names of the bidders and the amounts of their bids may be read aloud. Except where it may be deemed impractical, due to the nature or complexity of any invitation for bids, an abstract of bids that contains the amount of each bid and the name of the bidder shall be prepared for each invitation for bids. An abstract of bids shall be retained in the bid file and shall be available for public inspection.

Competitive Negotiation

Competitive negotiation may be used if conditions are not appropriate for the use of formal advertising. In competitive negotiation, proposals are requested from a number of sources and the Request for Proposals is publicized, negotiations are normally conducted with more than one of the sources submitting offers, and either a fixed-price or cost-reimbursable type contract is awarded, as appropriate. If competitive negotiation is used for procurement under a grant, the following requirements shall apply:

1. Proposals shall be solicited from an adequate number of qualified sources to permit reasonable competition consistent with the nature and requirement of the procurement. The Request for Proposals shall be advertised a minimum of five days statewide, and reasonable requests by other sources to compete shall be honored to the maximum extent practical. The Request for Proposals shall identify all significant evaluation factors. This identification must include the price or cost, where required, and the relative importance attached to price or cost.

2. The grantee shall provide mechanisms for technical evaluation of the proposals received, determinations of responsible offers for the purpose of written or oral discussions, and selection for contract award.

3. Award may be made to the responsible offering party whose proposal will be most advantageous to the procuring party, price and other factors considered. Unsuccessful offers should be notified promptly.

4. Grantees may utilize competitive negotiation procedures for procurement of architectural, engineering, archeological, and other professional services, whereby competitor's qualifications are evaluated and the most qualified competitor is selected, subject to negotiation of fair and reasonable compensation.

Noncompetitive Negotiation

Noncompetitive negotiation may be used when the award of a contract is not feasible under competitive bidding (formal advertising) or competitive negotiation procedures. Noncompetitive negotiation is procurement by soliciting a proposal from only one source, or after soliciting a number of sources, it becomes apparent the competition is not adequate. Circumstances under which a contract may be awarded by noncompetitive negotiation are limited to the following:

1. The item is available only from a single source.

2. Public exigency or emergency when the urgency for the requirement will not permit a delay incident to competitive solicitation.

3. After solicitation of a number of sources, competition is determined inadequate.

Single source contracts must be approved by the AHPP.

Bid Documentation

The following bid documentation is required and a copy must be provided to the AHPP:

1. Dated copies of all required advertisements.

2. Dated copies of all sealed bids received.

3. Names and addresses of all vendors contacted for quote bids.

4. Quotes from all bids.

5. Documentation of negotiations for negotiated contracts.

6. Justification for why the lowest bid was not accepted, if such was the case.

Bid Acceptance and Award

An award may be made to the lowest aggregate bidder for all items, group of items, or an individual item basis, whichever is deemed to be in the best interest of the project.

The right to reject any and all bids and to waive technicalities and minor irregularities in bids should be allowed.

After a reasonable evaluation period, the contract shall be awarded to the responsive and responsible bidder who submitted the lowest bid that meets the requirements and criteria set forth in the Invitation for Bids. If after evaluation of the bids, including consideration of any clarifying or explanatory information submitted by the bidders, it is determined that no satisfactory bid has been received, all bids may be rejected. If all bids are rejected, the grantee must re-advertise for the goods and/or services to be provided in accordance with these regulations.

EXHIBIT 1: HISTORIC PRESERVATION GRANT APPLICATION RATING SHEET

Priority I - Serious Endanqerment

Possible Points for each of the following (1-15)

1. Failed Roof- (serious leaks or holes; being structurally compromised; being either partially or totally missing)

Points Awarded________

2.Failed Foundation - (having serious or imminent threat to a structure; being badly cracked or shifted; being partially missing; being inadequate to support the structure)

Points Awarded -______

3.Failed Structural Integrity - (having serious or imminent threat to a structure; joists, rafters, floors, load-bearing walls, trusses, columns, or beams which show serious deterioration or are structurally compromised)

Points Awarded________

4.Failed Mechanical, Plumbing and Electrical Systems - (having serious or imminent threat to a structure)

Points Awarded________

5.Does Not Meet Minimum ADA Requirements (if applicable to grant proposal) Points Awarded________

6.Failed Masonry - (having serious or imminent threat to a property; having missing, cracked, or deteriorated mortar joints, having missing, cracked, or spalling brick, stucco, or stone)

Points Awarded________

7.Failed Windows - (having serious or imminent threat to a property; having missing, broken, or severely rotten window frames, sashes, or glass)

Points Awarded________

8.Failed Wood Siding - (having serious or imminent threat to a property; having missing, broken, or severely rotten wood siding)

Points Awarded________

Priority II - Serious Repairs

Possible Points for each of the following (1-10)

1. Windows - (repair or replication of original windows)

Points Awarded________

2.Removal of Artificial Siding - (removal of vinyl, metal, asphalt, or asbestos siding and repair of original siding or replacement with new siding to match the original)

Points Awarded________

3.Exterior Architectural Elements - (repair or replication of significant exterior architectural elements such as missing or severely dilapidated porches, columns, turrets, cupolas, or domes)

Points Awarded________

4.Repair of Guttering Systems

Points Awarded________

5.Removal of Asbestos or Lead Paint

Points Awarded________

6.Repair and/or Installation of Seismic Reinforcement

Points Awarded________

Priority III -Cosmetic Repair

Possible Points for each of the following (1-10)

1. Windows - (general repair, puttying, scraping, repainting) Points Awarded,________

2.Masonry - (general tuck pointing, cleaning, etc.)

Points Awarded________

3. Paint - (general cleaning, stripping, scraping of exterior paint if it has failed)

Points Awarded________

4.Interior Features - (repair, restoration, or replication of missing or deteriorated original interior features considered significant to the National Register eligibility of the property. The features must be documentable through historic photographs, original architectural drawings/specifications, or architectural investigations. Projects may include: decorative plaster work, murals, stencils, faux finishes, decorative painting, carved/decorative moldings and trim, wood paneling, fireplace)

Points Awarded________

Total Points__________

Staff Comments

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TO ALL TO WHOM THESE PRESENTS COME - GREETINGS: EO-98-04

AN EXECUTIVE ORDER ESTABLISHING MANDATORY GUIDELINES AND PROCEDURES TO BE FOLLOWED BY THE EXECUTIVE DEPARTMENT IN AREAS OF EMPLOYMENT, GRANTS, CONTRACTS AND PURCHASING TO PREVENT WASTE, ABUSE OR THE APPEARANCE OF IMPROPRIETY AND TO CREATE A CLEARINGHOUSE FOR GRANTS AND CONTRACTS.

WHEREAS, the acts of a few have created an unfortunate but predictable deterioration of public confidence in public officials, the majority of whom serve loyally and at great personal sacrifice; and

WHEREAS, the taxpaying citizens of Arkansas annually entrust their state government with more than S4.3 billion paid by them in the form of taxes; and

WHEREAS, the Arkansas Constitution provides, "All political power is inherent in the people and government is instituted for their protection, security and benefit;" and

WHEREAS, recent events have brought to light abuses in state government that have resulted in misappropriation and waste of the hard-earned money of the citizens of this great State; and

WHEREAS, the practice of hiring public officials or their family members has at times created an appearance of impropriety; and

WHEREAS, the letting of personal service or purchasing contracts and grants to businesses that benefit public officials or their family members has occurred without disclosure or scrutiny; and

WHEREAS, no clearinghouse exists for disclosure of whether individuals or entities are simultaneously obtaining duplicative grants from separate agencies for the same intended purpose; and

WHEREAS, appropriate executive action is necessary to ensure that the executive department of this State acts responsibly in its administration of the citizens' money, protecting the people from waste and abuse so that the government-is truly acting for "their protection, security and benefit;"

NOW, THEREFORE, I, Mike Huckabee, acting under the authority vested in me as Governor of the State of Arkansas, do hereby order:

I. DISCLOSURE REQUIREMENTS

Agencies shall require, as a condition of obtaining or renewing a contract, lease, purchase agreement, employment, or grant with any state agency, that any individual desiring to contract with, be employed by, or receive grant benefits from, any state agency shall disclose whether that person is current of former member of the general assembly constitutional officer board of.

II. APPROVAL OF CONTRACTS AND GRANTS

Agencies shall be prohibited from entering into or renewing any contract, lease, purchase agreement, or grant with any current or former member of the general assembly, constitutional officer, board or commission member, state employee, or the spouse or immediate family member of any of the persons described in this sentence, or with any entity in which any such person holds (i) any position of control, or (ii) any ownership interest of 10% or greater.

The prohibition provided in the previous sentence shall not apply to:

(i) contracts, leases, or purchase agreements that are the result of competitive sealed bidding, or a request for proposal, which requires public notice and public opening of bids or proposals; provided, however, agencies shall be required to disclose any such contract, lease, or purchase agreement entered into with any of the persons described in the previous paragraph, notice of which is given to the Governor and the Legislative Council; or

(ii) contracts or purchase agreements subject to competitive bidding, for which the total consideration is less than $10,000; provided, however, agencies shall be required to disclose any such contract, lease, or purchase agreement entered into with any of the persons described in the previous paragraph, notice of which is given to the Governor and the Legislative Council; or

(iii) any contract, lease, purchase agreement, or grant not subject to competitive sealed bidding or a request for proposal, for which the total consideration is $10,000 or greater, and the prior written approval of the Chief Fiscal Officer of the State is obtained, notice of which approval is given to the Governor and the Legislative Council.

III. DISCLOSURE OF SUBCONTRACTORS

Agencies shall require, as a condition of obtaining or renewing a contract, lease, purchase agreement, or grant with any state agency, that any individual or entity desiring to contract with any state agency shall require that any subcontractor, sub-lessor, or other assignee (hereinafter "Third Party"), shall disclose whether such Third Parry is a current or former: member of the general assembly, constitutional officer, board or commission member, state employee, or the spouse or immediate family member of any of the persons described in this sentence, or if any of the persons described in this sentence hold any position of control or any ownership interest of 10% or greater in the Third Party, and shall report any such disclosure by the Third Party to the agency. The disclosure requirements of this paragraph shall apply during the entire term of the contract, lease, purchase agreement, or grant, without regard to whether the subcontract, sublease, or other assignment is entered into prior or subsequent to the contract date.

Agencies shall require, as a further condition of obtaining or renewing any contract or agreement with any state agency, that the individual or entity desiring to contract shall incorporate into any agreement with a Third Party, previously defined, the language of Paragraph XI of this order, and any other necessary language as provided by rules and regulations promulgated to enforce this order, which provides that failure of .the Third Party to disclose the identity of any person or entity described in the previous paragraph shall be considered a material breach of the agreement.

IV. REPORT OF BENEFITS RECEIVED

Department of Finance and Administration shall promulgate regulations to implement the requirements of Ark. Code Ann. § 19-11-706, which requires an individual drawing a salary from or performing personal services for an agency to report to the Director of Department of Finance and Administration any benefit from any State contract with a business in which the individual has a financial interest, and provides that failure to report as required may subject the individual to criminal sanctions, as provided in Ark. Code Ann. § 19-11-702.

V. DISCLOSURE OF CONTRACTS AND GRANTS

Agencies shall disclose all (i) grants awarded to, and (ii) all goods and services sold or leased to them by, current or former members of the following: the general assembly, constitutional officers, board and commission members, state employees, the spouse and immediate family members of any of the persons described in this sentence, or business entities in which persons described in this sentence hold (i) any position of control, or (ii) any ownership interest of 10% or greater.

Department of Finance and Administration shall serve as a central clearinghouse for agency disclosure forms that shall be maintained in accordance with this executive order.

All such disclosure shall be compiled periodically from clearinghouse information and reported to the Governor, with notice to the Legislative Council

VI. SOLE SOURCE CONTRACTS

Agencies shall review all 'sole source" contract procedures to ensure compliance with the purpose and intent of this order.

VII. RESTRICTIONS ON EMPLOYMENT OF LEGISLATORS AND CONSTITUTIONAL OFFICERS

Agencies shall be prohibited from hiring any member of the general assembly or any constitutional officer while the member or officer is serving in his or her elected office. Agencies shall further be prohibited from hiring former members of the general assembly or former constitutional officers in any job created or enhanced by legislation in the two-year period immediately preceding the conclusion of that person's term of office. Agencies shall provide notice of the hiring of any former legislator or former constitutional officer to the Chief Fiscal Officer of the State, the Governor, and the Legislative Council.

VIII. RESTRICTIONS ON EMPLOYMENT OF CERTAIN FAMILY MEMBERS

Agencies shall be prohibited from hiring spouses and immediate family members of members of the general assembly, constitutional officers, and state employees without the prior written approval of the Chief Fiscal Officer of the State, notice of which approval is given to the Governor and the Legislative Council.

IX. RESTRICTIONS ON EMPLOYMENT OF PRESENT AND FORMER EMPLOYMENT

and implement any necessary rules, regulations or policies to insure compliance with the purpose and intent of this executive order.

XI. FAILURE TO DISCLOSE AND VIOLATIONS

Every agreement executed by an Agency, whether a contract, lease, purchase agreement, or grant, shall be required to contain the following condition as a term of the agreement and shall be further required to provide that this condition shall be contained in any subcontract, sublease, or other assignment of the terms of the agreement to any Third Party, as defined in Paragraph V:

The failure of any person or entity to disclose as required under any term of Executive Order 98-04, or the violation of any rule, regulation or policy promulgated by the Department of Finance and Administration pursuant to this Order, shall be considered a material breach of the terms of the contract, lease,, purchase agreement, or grant and shall subject the party failing to disclose or in violation to all legal remedies available to the Agency under the provisions of existing law.

XII. AGENCIES AFFECTED

The provisions of this Order shall apply to entities that are within the control of the governor.

Members of the Legislature, any employees of, or positions in the Legislative branch of Arkansas State Government; the Justices of the Supreme Court, Judges of the Court of Appeals, Judges of the Circuit, Chancery or Circuit/Chancery Courts, Judges of the Inferior Courts, or any employee of, or position in the Judicial branch of Arkansas State government; elective officers of the State and any employee of the offices of Lieutenant Governor, Attorney General, Secretary of State, State Auditor, Land Commissioner, and State Treasurer; members and staff of multimember boards, commissions, or committees that are exempt by law from the provisions of the "Arkansas Purchasing Law", Ark. Code Ann. § 19-11 -201 et seq.; and employees of the Arkansas Highway and Transportation Department and the Arkansas Game and Fish Commission are encouraged to voluntarily agree to be covered by the provisions of this Executive Order.

XIII DEFINITIONS

For purposes of the foregoing Executive Order, the following definitions shall apply:

MEMBERS OF THE GENERAL ASSEMBLY shall mean member(s) of the Arkansas House of Representatives or of the Arkansas Senate.

FORMER MEMBER OF THE GENERAL ASSEMBLY shall mean any person who was a member of the General Assembly within two years prior to entering into any contract with or receiving any grant awarded by a state agency.

CONSTITUTIONAL OFFICER shall mean Governor, Lieutenant Governor, Secretary of State, Treasurer of State, Attorney General, Commissioner of State Lands, and Auditor of State.

FORMER CONSTITUTIONAL OFFICER shall mean any person who was a Constitutional Officer within two years prior to entering into any contract with or receiving any grant awarded by a state agency.

012.02.01 Ark. Code R. 004

6/15/2001