Md. Code Regs. 05.04.09.15

Current through Register Vol. 51, No. 24, December 2, 2024

Section 05.04.09.15 - Construction Process

A. General.

(1) As required by applicable codes and rehabilitation standards, building permits shall be obtained before loan closing, and are required to be posted at the project before the beginning of construction or modification.

(2) Work done, materials supplied, and construction procedures employed shall comply with all contract documents, applicable codes and rehabilitation standards, and these Regulations . The Department's general requirements and specifications guidelines will be furnished on request.

B. Contract Documents.

(1) Contract documents may include, but are not limited to the following:

(a) Structural soundness certification;

(b) Building or rehabilitation loan agreement;

(c) Specifications or work write-ups;

(d) Contractor's proposal;

(e) Architectural or engineering drawings, or both;

(f) Construction or rehabilitation contract;

(g) Change orders.

(2) There shall be no modification of any contract document without the prior written consent of the Department, as evidenced by an approved change order, executed by the Program, the contractor, and the borrower.

C. The Borrower and the Contractor.

(1) The borrower and the contractor shall cooperate to facilitate timely performance of the construction or modification work and selection of materials.

(2) The borrower shall provide the contractor access to the property during normal business hours, and shall permit the contractor to use existing utilities for the execution and completion of work, at no cost to the contractor unless specified otherwise.

(3) The borrower is responsible for removing and replacing rugs, furnishings, and other personal property, unless otherwise provided in the contract documents.

(4) The borrower and the contractor shall protect and maintain the property and improvements in accordance with the contract documents.

(5) The borrower and the contractor, and each of them, shall hold and save the Department harmless from any and all loss, claim, cost, or damage of every kind, nature, and description arising from or related to the contract documents.

(6) Communications relating to content or performance of the contract shall be in writing, and copies sent to the Program.

D. Inspections.

(1) The Department, in its sole discretion, shall determine the frequency and level of inspections during construction or modification, taking into consideration:

(a) The capability of the borrower;

(b) The demonstrated experience and reliability of the contractor;

(c) The amount of the loan;

(d) The availability of local technical assistance; and

(e) Other factors considered relevant by the Department.

(2) The Department may charge borrowers a fee for inspections during construction or modification.

E. Construction Disputes. If disputes between the contractor and borrower occur, the Department shall recognize the findings of the Home Improvement Commission and the Consumer Protection Division of the Office of the Attorney General.

F. Termination of Contracts. Contracts may be terminated for cause in accordance with the loan documents, contract documents, and Program policies and procedures.

Md. Code Regs. 05.04.09.15

Regulations .15 adopted as an emergency provision effective February 23, 1987 (14:6 Md. R. 704); adopted permanently effective July 27, 1987 (14:15 Md. R. 1657)
Regulations .15 adopted effective May 25, 1992 (19:10 Md. R. 929)