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<br />Page 22 of 22 <br />K2871 Grant Agreement <br />(1) The non-Federal entity's procurement procedures or operation fails to comply with the procurement standards in this <br />part; <br />(2) The procurement is expected to exceed the Simplified Acquisition Threshold and is to be awarded without competition <br />or only one bid or offer is received in response to a solicitation; <br />(3) The procurement, which is expected to exceed the Simplified Acquisition Threshold, specifies a “brand name” <br />product; <br />(4) The proposed contract is more than the Simplified Acquisition Threshold and is to be awarded to other than the <br />apparent low bidder under a sealed bid procurement; or <br />(5) A proposed contract modification changes the scope of a contract or increases the contract amount by more than the <br />Simplified Acquisition Threshold. <br />(c) The non-Federal entity is exempt from the pre-procurement review in paragraph (b) of this section if the Federal <br />awarding agency or pass-through entity determines that its procurement systems comply with the standards of this part. <br />(1) The non-Federal entity may request that its procurement system be reviewed by the Federal awarding agency or pass- <br />through entity to determine whether its system meets these standards in order for its system to be certified. Generally, these <br />reviews must occur where there is continuous high-dollar funding, and third party contracts are awarded on a regular basis; <br />(2) The non-Federal entity may self-certify its procurement system. Such self-certification must not limit the Federal <br />awarding agency's right to survey the system. Under a self-certification procedure, the Federal awarding agency may rely on <br />written assurances from the non-Federal entity that it is complying with these standards. The non-Federal entity must cite <br />specific policies, procedures, regulations, or standards as being in compliance with these requirements and have its system <br />available for review. <br />§200.325 Bonding requirements. <br />For construction or facility improvement contracts or subcontracts exceeding the Simplified Acquisition Threshold, the <br />Federal awarding agency or pass-through entity may accept the bonding policy and requirements of the non-Federal entity <br />provided that the Federal awarding agency or pass-through entity has made a determination that the Federal interest is <br />adequately protected. If such a determination has not been made, the minimum requirements must be as follows: <br />(a) A bid guarantee from each bidder equivalent to five percent of the bid price. The “bid guarantee” must consist of a <br />firm commitment such as a bid bond, certified check, or other negotiable instrument accompanying a bid as assurance that the <br />bidder will, upon acceptance of the bid, execute such contractual documents as may be required within the time specified. <br />(b) A performance bond on the part of the contractor for 100 percent of the contract price. A “performance bond” is one <br />executed in connection with a contract to secure fulfillment of all the contractor's obligations under such contract. <br />(c) A payment bond on the part of the contractor for 100 percent of the contract price. A “payment bond” is one executed <br />in connection with a contract to assure payment as required by law of all persons supplying labor and material in the execution <br />of the work provided for in the contract. <br />§200.326 Contract provisions. <br />The non-Federal entity's contracts must contain the applicable provisions described in Appendix II to Part 200—Contract <br />Provisions for non-Federal Entity Contracts Under Federal Awards. <br />