STATE OF YAP
OFFICE OF THE GOVERNOR
P.O. Box 39
Colonia, Yap  96943
Federated States of Micronesia
Tel: (691) 350-2108 / 2109
Fax: (691) 350-4113

STATE REGULATIONS NO.: 1995-01

RE: 1995 Amendments to State Bidding Regulations

Section 1. Introduction - Pursuant to the State Contracts Act and the Administrative Procedure Act, the State Bidding Regulations are amended to improve the administration of the State Contracts Act.

Section 2. Return of Proposal Guaranties - Section 3.5 of Section 3 of the Bidding Regulations is amended to read as follows:

"3.5 RETURN OF PROPOSAL GUARANTIES - All proposal guaranties, except those of the three (3) lowest bidders, will be returned immediately following the opening, checking and evaluation of the proposals. The successful bidder's proposal guaranty will be returned after a satisfactory contract bond or security has been furnished and the contract has been executed. The retained proposal guaranties of the remaining two (2) lowest bidders will be returned within seven (7) working days following the execution of the contract."

Section 3. Requirement of. Contract Bond - Subsection 3.6 of - - Section 3 of the Bidding Regulations is amended to read as follows:

"3.6  REQUIREMENT OF CONTRACT BOND - The Contracting Officer may, in his/her discretion, require that the successful bidder file a surety bond or security conditional on the performance of the contract. If a contact bond or security is required, the form and amount of the bond or security must be indicated by the Contracting Officer.

If required by the Contracting Officer, the successful bidder w shall file a good and sufficient surety bond or security conditioned on the full and faithful -performance of the contract in accordance, with the terms and intent thereof. and also for the prompt payment to all others for all labor and materials furnished by them and used in the prosecution of the work provided for in such contract, in the manner, form and amount required by Contracting Officer. Such bond or security shall also by its terms protect any and all persons entitled to file claims for labor performed or materials furnished in the work.

If the surety on any bond or security is other than a surety company authorized to do business under the laws of the State and the National Government, the Contracting Officer shall also require such surety or sureties to severally deposit with him/her certified checks or certificates of deposit, bonds, stocks or other negotiable securities, or execute and deliver to him/her a deed or deeds of trust, all of such character as shall be satisfactory to the Contracting Officer, and each surety shall furnish such security to the cash value of the amount the Contracting Officer may require.

Section 4. Effective date - These regulations shall take effect 20 days after filing with the Attorney General and the Chief Clerk of the Legislature.

Issued by:
/s/                                      date: 09-08-95
Vincent Figir
Governor, Yap State

Received and Filed:
/s/                                      date: 09-08-95
Chief Clerk Legislature
 
Received and Filed:
/s/                                      date: 09-08-95
Attorney General


OFFICE OF THE GOVERNOR
 State of Yap
 Federated States of Micronesia Cable: GOV YAP
 Western Caroline Islands, 96943
P.O. Box 39 Phone: 2108 or 2109

EXECUTIVE ORDER NO.   1-87

SUBJECT:  State Bidding Regulations

     WHEREAS, the State Contracts Act, Yap State Law No. 1-215,
became effective on August 8, 1986; and

     WHEREAS, Section 15 of Yap State Law No. 1-215 provides that the Governor shall issue regulations t.9-implement this Act;

     WHEREAS, such regulations have been drafted and subjected to public comment as required by the State Administration Procedures Act, Yap State Law No. 1-90;

     NOW THEREFORE, pursuant to the authority vested in the Governor, the proposed set of bidding regulations is hereby adopted and promulgated as the State Bidding Regulations.

     IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
seal this 23rd day of July 1987.

/s/
Petrus Tun
Governor

SUBSCRIBED AND SWORN TO before me this 23rd day of July, 1987

/s/
Asst. Clerk of Court
FSM Supreme Court, Yap



STATE BIDDING REGULATIONS

     PURPOSE AND SCOPE: These regulations implement the provisions of the State Contracts Act (Y.S.L. No. 1-215), establishing procedures for competitive bidding on public contracts of the State Government. These procedures shall apply to those contracts which state law requires to be let or awarded by competitive bidding.

SECTION 1
DEFINITIONS

     Addendum  A written document which may be issued by the Contracting Officer during the bidding period involving changes to the plans and specifications which shall be considered and made a part of the contract documents.

     Advertisement for Bids  A public announcement inviting bids for work to be performed or materials to be furnished. The advertisement will indicate the nature of the work to be done or materials to be furnished and it shall state the final date and tires for receipt of bids and the time and place of opening bids.

     Bid or Proposal  The offer of a bidder submitted in the prescribed manner, to perform at the prices quoted the work specified under the contract.

     Bidder  Any individual, partnership, firm, corporation, joint venture, or other legal entity that is submitting, directly or through a duly authorized representative or agent, a bid or proposal for the work contemplated.

     Calendar day  Any day shown on the calendar, beginning at midnight and ending at midnight the following day. If no designation of calendar or working day is made, "day" shall mean calendar day.

     Citizen Bidder  Any business in which at least fifty-one (51) percent of the interest therein is owned by a citizen or citizens of the Federated States of Micronesia and is a resident of the State of State of Yap for at least five years prior to the submission of the bid. At least a substantial percentage of the bidder's labor force are Federated States of Micronesia citizens and are Yapese by birth or have resided in the State of Yap for at least two (2) years immediately prior to the submission of the bid for contract.

     Contract  The written agreement between the Contractor and the State of Yap by its Contracting Officer, by which the Contractor is bound to furnish all labor, equipment, and materials and to perform the specified work within the contract time. stipulated therein, and by which the State of Yap is obligated to compensate the Contractor at the price set forth therein. The contract may ,, include the Notice to Contractors, Special Notice to Bidders, Addenda, Proposal, Wage Schedule, list of Subcontractors, General Conditions, Special Provisions, Plans, Technical Specifications, Contract Bonds any and all amendments and change orders that are required to complete the construction in an  acceptable manner and any other items specifically incorporated by the written agreement.

     Contract Bond  The approved-form of security furnished by the Contractor and his/her Surety or Sureties to guarantee the completion of the work in accordance with the terms of the contract and to guarantee full payment of all claims for labor, materials and supplies used or incorporated in the work.

     Contracting Officer  The official in charge of advertising, negotiating, letting, awarding, administering and monitoring the performance of a contract for the State of Yap, as provided by law.

       Contractor  Any individual, partnership, firm, corporation or joint venture, or other legal entity undertaking the execution of the work under the terms of the contract with the State of Yap, and acting directly or through his/her, their or its agents, employees or subcontractors.

      Engineer  The State Engineer acting for the Contracting Officer directly or through an assistant or representative.

      Equal or Approved Equal  A brand or article qualified by the Contracting Officer, which may be used in place of the one stated in the plans or specifications.

       Holidays  The days of each year which are set apart and established as legal holidays.

       Inspector  Authorized representative of the Engineer assigned to make detailed inspections of contract performance and materials supplied.
 
      Letter of Award  A written notice from the Contracting Officer to the successful bidder stating that his/her proposal has been accepted by the State.

      Lowest Responsible Bidder  The lowest qualified bidder whose offer adequately responds in quality, fitness and capacity to the particular requirement of the proposed work called for by the contract.

      Notice of Intention to Bid  The written notice filed by prospective bidders indicating their desire to bid on a project announced in a Notice to Contractors posted by the State.

     Notice to Proceed  A written notice from the Contracting Officer to the Contractor advising him/her of the date on which he/she is to begin the prosecution of the work, which date shall also be the beginning of contract time.

      Plans  The contract drawing(s) approved by the Contracting Officer which show the location, character, dimensions and details of the work to be done and which shall be a part of the contract.

      Project Guarantee  A guarantee issued by the Contractor to the State warranting against defects resulting from the use of defective materials or equipment and poor supervision or workmanship.

     Proposal Form  The form prepared by the State of Yap on which the written offer or formal bid for the work to be done is submitted by the bidder.

      Proposal Guaranty or Bid Bond  The security furnished by the -bidder as a warranty of good faith that he/she will enter into a contract with the State and to execute the required performance and payment bonds covering the work contemplated, if his/her proposal is accepted.

      Regulations  The directions, provisions and requirements contained herein pertaining to the method and manner of letting contracts through the bidding process.

      Special Provisions  The specific clauses setting forth conditions or requirements peculiar to the individual project under consideration, which are not otherwise thoroughly or satisfactorily stipulated in these regulations.  

      Specifications  The technical provisions of construction or procurement.

      State  The State of Yap, Federated States of Micronesia, acting through its authorized representative.

      Subcontractor  An individual, partnership, firm, corporation, joint venture or other legal entity which enters into an agreement with the Contractor to perform a portion of the work for the Contractor.

      Superintendent  The representative of the Contractor, authorized to receive and fulfill instructions from the Engineer, who is charged with the responsibility of all work.

      Surety   The individual, firm or corporation other than the Contractor, which executes a bond with and for the contractor to insure his/her acceptable performances of the contract.

      Working Day   A calendar day, exclusive of Saturdays, Sundays and State-recognized legal holidays.

SECTION 2
PROPOSAL REQUIREMENTS AND CONDITIONS

     2.1   COMPETITIVE BIDDING REQUIRED   Except as otherwise provided by law, all contracts for construction projects involving ten thousand dollars ($10,000) or more, or for the purchase of personal property involving five thousand dollars ($5,000) or more, made on behalf of the State Government shall be let and procured by free and open competitive bidding, by sealed bids.

     2.2  ADVERTISEMENT FOR BIDS  Publication of a call for sealed bids or proposals shall include posting of notice for at least ten (10) calendar days in the Immigration Office, and one (1) other prominent public place in the State, the use of radio and newspaper media, when considered appropriate by the Contracting Officer, and any other means considered feasible and desirable. The notice shall state in clear terms the project that is to be bid on.

     2.3   QUALIFICATION OF BIDDERS - Prospective bidders must be capable of performing the work for which bids are being called.

     Each prospective bidder must file a written notice of their intention to bid. This written notice must be addressed to the Contracting Officer, Yap State, Federated States of Micronesia, who is the officer charged with letting the contract. The words "intention to bid" must be clearly written or typed on the face of the envelope containing the written notice of intention to bid. The notice may be handcarried, mailed or sent by telex to the office indicated in the Advertisement for Bids.

     The written notice must be received in the above office no later than 3:00 p.m. on the tenth (10th) calendar day prior to the day designated for opening bids. The written notice will be time stamped when received by said office. The time designated by the time stamping device in said office shall be official. If the written notice is handcarried, the bearer is responsible to ensure that the notice is time stamped by said office. The State assumes no responsibility for failure of timely delivery caused by the prospective bidder or by any method of conveyance chosen by the prospective bidder.

     If two (2) or more prospective bidders desire to bid jointly as a joint venture on a single project, they must file an affidavit of joint venture with their notice of intention to bid. Such affidavit of joint venture will be valid only for the specific project for which it is filed.

     The Contracting Officer shall require the prospective bidder to submit answers by the bid opening date to questions contained on the form provided by the State, properly executed and notarized, setting forth a complete statement of the financial background of the bidder and his/her organization, as well as a complete statement of the experience of such prospective bidder and his/her organization in performing similar work and a statement of the equipment proposed to be used, together ,~;~, with adequate proof of the availability of such equipment. If the information in the questionnaire proves satisfactory, the bidder's proposal will be received. All information contained in the answers to the questionnaire shall be kept confidential.

     If upon review of the Questionnaire, or otherwise, the bidder appears not fully qualified or able to perform the intended work, the Contracting Officer may in his/her discretion afford the bidder an opportunity to be heard and if the Contracting Officer is still of the opinion that the bidder is not fully qualified to perform the work, he/she shall refuse to receive or to consider any bid offered by the prospective bidder. Upon being determined not to be fully qualified, the bidder may appeal this determination within ten (10) days after notice of disqualification in accordance with the State Administrative Procedure Act. Yap State Law No. 1-90.

     Failure to complete the prequalification questionnaire will be sufficient cause for the State to disqualify a prospective bidder.

     2.4   CONTENTS OF BID OR PROPOSAL FORMS - Prospective bidders will be furnished with bid or proposal forms giving the location, description and the contract time of the work or procurement contemplated for which a lump sum bid price is asked, or containing a schedule of items, together with estimated quantities of work to be performed and materials to be furnished, for which unit bid prices or lump sum bid prices are asked.

     Proposal forms will also require a listing -of.joint contractors and subcontractors, including the. name of each person or firm to be engaged on-the project-as a joint contractor or subcontractor.

     All papers with or attached to the proposal form shall be considered a part thereof and shall not be detached or altered when the proposal or bid is submitted. The plans, specifications and other documents designated in the proposal form will also be considered a part thereof whether attached or not.

     2.5  INTERPRETATION OF QUANTITIES IN BID SCHEDULE - When quantities for individual items of work are listed in the proposal form for which respective unit prices are asked, said quantities are to be considered as approximate and are to be used by the State only for the purpose of comparing on a uniform basis bids offered for the work. The State does not, expressly or by implication, agree that the actual quantity of work will correspond therewith. After determining the low bidder by comparison of bids submitted, the State reserves the right to increase or decrease the scope of the improvement. The Contractor shall have no claim for anticipated profit or loss of profit when the State exercises or invokes its right to eliminate entirely portions of the work or to increase or decrease any or all of the quantities shown in the proposal form.

     On unit price bids, payment will be made only for the actual number of units incorporated into the finished project;t at the unit price bid.

     2.6   BIDDERS RESPONSIBILITY FOR EXAMINATION OF PLANS, SPECIFICATIONS, SITE OF WORK, ETC. - The bidder shall examine carefully the site of work contemplated and the proposal, plans, specifications, supplemental specifications, special provisions, all addenda issued, all applicable contract and bond forms, all applicable laws and regulations and any other sources of information necessary to make a knowing and fully informed b~ The submission of a bid shall be considered as a warranty that the bidder has made such examination and agrees to and is satisfied with the conditions to be encountered in performing the work.

     No additional compensation will be given by reason of the Contractor's misunderstanding or lack of knowledge of the requirements of the work to be accomplished or the conditions to be encountered in performing the project.

     Where an investigation of subsurface conditions has been made by the State in respect to foundation or other design, the bidders may inspect the records of the State as to such investigation, including examination of samples, if any. However, any such information is furnished for the bidders' convenience only and no assurance is given that conditions found at the time of the subsurface investigation, such as the presence or absence of water, will be conditions that prevail at the time of construction.

     When the contract plan includes a log of test borings showing a record of the data obtained by the State's investigation of subsurface conditions, said log represents only the opinion of the State as to the character of material encountered by it in its test borings and there is no warranty, either express or implied, that the conditions indicated are representative of those existing throughout the work or any part of it, or that unforseen developments may not occur.

     No information derived from such inspection of records of surface or subsurface investigations made by the State, or from the Contracting Officer or his/her authorized representative, or from maps, plans, specifications or drawings in any way relieve the terms of the contract. Any log test borings included in the plans are for the convenience of the bidder and do not constitute a part of the contract. The Contractor is solely responsible for verifying the accuracy of the information contained in the surface or subsurface records furnished by the State, and the Contractor is solely responsible for all assumptions, deductions or conclusions he/she may make or derive from these records.

     It is the responsibility of the bidder to verify all information respecting the site of the work given on the drawings or specifications. Any utilities that the Contractor encounters," during the progress of the work, suel telephone ducts, electric ducts, water lines, sewer lines and drainage pipes; whether shown or not on the contract plans; shall not be disturbed or damaged unless otherwise instructed, in the plans and specifications. In the event. the Contractor disturbs or damages any utilities which were shown on the plans and specifications, located and exposed on the job as it progressed, pointed out to the Contractor or should have been discovered by the. Contractor in the exercise of reasonable care, said Contractor shall be liable for any and all resulting damages.

     The contractor shall repair the damaged or disturbed utilities to the pre existing condition at no cost to the State or the project. Any damage claims due to the disruption of service caused by the utilities being damaged shall be paid by the Contractor who shall hold harmless the State from all suits,actions or claims of any-character-brought on account of such damages.
 
     2.7   ADDENDA AND INTERPRETATIONS - Discrepancies, omissions, or doubts as to the meaning of drawings and specifications should be communicated in writing to the Contracting Officer for interpretation and must be received by the Contracting Officer no later than fourteen (14) calendar days prior to the. date fixed for bid opening. Any interpretation, if made, and any supplemental instructions will be in the form of written addenda to the specifications, which will be mailed to all prospective bidders at the respective addresses furnished for such purposes, nine (9) calendar days prior to the date fixed for the opening of bids. Failure of any bidder to receive any such addendum or interpretation shall not relieve such bidder from any obligation under his/her bid as submitted. All addenda so issued shall become part of the contract documents.

     2.8   MATERIALS AND EQUIPMENT, SUBSTITUTIONS THEREOF - The Contractor shall be required to install materials and equipment as called for in the plans and specifications or as qualified in subsequent addenda which change the plans and specifications. In any section of the specifications or plans where one or more brand names of materials or equipment are specified to indicate a quality, style, appearance or performance, the bidder shall base his/her bid on the specified brand names unless alternate brands are qualified as equal or better by the Contracting Officer in a published addendum to such plans and specifications. Alternate brands not listed in the plans and specifications may be qualified through the submittal to the Contracting Officer of a written request for review and approval of the substitution.

     The written request must be addressed to the Contracting Officer, and the envelope containing the request must be clearly marked SUBSTITUTION RE()UEST on the face. The request may be handcarried to the Engineer, or mailed to the Contracting Officers` In either case, the written request must be received by the Contracting Officer no later than the time and date specified in Section 2.7. The written request will be time stamped by the State. If the written request is handcarried, the bearer is responsible to ensure that the request is time stamped by the State. The written request shall be submitted in triplicate, together with two (2) sets of technical brochures which shall either be marked or be accompanied by two (2) copies of a statement of variances.

     The statement of variances must list all features of the proposed substitution which differ from the plans, specifications or products specified, and must further certify that the substitute has no other variant features. The brochures must include sufficient evidence to enable the Contracting  Officer or the Engineer to evaluate each feature listed as a variance. Should an unlisted variance be discovered after installation of the product, the penalty shall be immediate replacement with a specified product at no additional cost to the State.

     Any request for substitution not accompanied by sufficient information from which a determination can be made shall be denied. However, further information may be submitted to qualify the same proposed substitution up to fourteen (14) days prior to the bid opening date.

     All proposed substitutions which do not satisfy project specification requirements, and all requests for substitution not complying with the above requirements, will be denied. Requests rejected on these grounds do not have the privilege to submit further information.

     An addendum shall be issued to the specifications to formally inform the prospective bidders of any approved substitution of brand or brands which are equivalent to those specified and acceptable for use in the proposed project.

     Substitution of material or equipment may be allowed after the bid opening date only as provided for by law, and as provided for in the contract.

     2.9   PREPARATION OF PROPOSAL - The bidder's proposal must be submitted on the proposal form furnished by the State. The proposal must be prepared in full accordance with the instructions thereon. The bidder must state, both in words and figures, the lump sum price at which the work contemplated is proposed to be done. These prices must be written in ink or typed. In case of a discrepancy between the prices written in words and those written in figures, the words shall govern over the figures. The bidder shall sign with ink the proposal in the spaces provided.

     If the proposal is made by an individual, his/her name and post office address must be shown in the apace provided. If made by partnership, the name and-post office address of each member of the partnership must be shown and the proposal signed by all partners or evidence in the form of a partnership agreement must be submitted showing the authority of the partner to enter, on behalf of said partnership, into contract with the State. If made by a corporation the proposal must show the name, titles, and business address of the president, secretary and treasurer and also evidence in the form, of a corporate resolution must be submitted showing the authority of the particular corporate representative to enter, on behalf of said corporation, into contract with the State. If made by a joint venture the name and post office address of each member of the individual firm, partnership or corporation comprising the joint-venture must be shown with other pertinent information required of individuals, partnerships or corporations as the case may be. The proposal must be signed by all parties to the Joint-Venture or evidence in the form of a Joint-Venture Agreement must be submitted showing the authority of the Joint Venture's representative to enter, on behalf of said Joint-Venture, into contract with the State.

     Each bidder shall include in his/her bid a complete list of the names of each person or firm to be engaged by the bidder as a joint contractor or subcontractor in the performance of the construction project contract, indicating the nature and scope of the work to be performed by such joint contractor or subcontractor, and any other relevant information the Contracting Officer may require. All work which is not listed as being performed by joint contractors or subcontractors must be performed by the bidder and his/her employees. Whenever there is doubt, the Contracting Officer 'may require the bidder to submit within seven (7) working days written confirmation specifying which work will be performed by the bidder and which will be performed by any given joint contractor or subcontractor. If more than one (1) joint contractor or subcontractor is listed for the same item of work, the bidder will be required within seven (7) working days. to either confirm in writing that all joint contractors or subcontractors listed will actually be engaged on the project, or submit written releases from those joint contractors and subcontractors who will not be engaged.

    2.10   PROPOSAL GUARANTY - The Contracting Officer may, at his/her discretion, require that all proposals be accompanied by a proposal guarantee. If &proposal guarantee is required, the form and the amount of the guarantee must be as indicated by the Contracting Officer, and must be submitted with the proposal.

     All proposals for construction projects of one hundred thousand dollars ($100,000), or more, shall be accompanied by a proposal guaranty. The proposal guaranty shall be in a sum not less than five (5) percent of the amount bid; provided, however, that if the amount bid exceeds two hundred thousand dollars ($200,000), the proposal guaranty shall be in a sum not less than ten thousand dollars ($10,000) plus two (2) percent of the amount in excess of two hundred thousand dollars ($200,000).

     The proposal guaranty shall be in one of the following forms of bidder's security:

  a.       Cash;

  b.       Certificate of Deposit made by a bank that is insured by the Federal Deposit Insurance Corporation and made payable to the Treasurer, State of Yap, FSM;

  c.       Certified check made by a bank that is insured by the Federal Deposit Insurance Corporation and made payable to the Treasurer, State of Yap, FSM;

  d.      Cashier's check made by a bank that is insured by the Federal Deposit Insurance Corporation and made payable to the Treasurer, State of Yap, FSM; or

  e.       Bidder's bond executed by bidder and an approved surety insurer, authorized to do business in the United States and the FSM and made payable at sight to the Treasurer, in the manner, form and amount required by the Treasurer, Yap State, FSM.

     If proposal guaranty exceeds fifty thousand dollars ($50,000), it must be in the form of cash or surety bond. Certificates of Deposit, cashier's checks and certified checks will not be accepted in amounts exceeding fifty thousand dollars ($50,000).

     In the case where the award will be made on a group or item basis, the amount of the proposal guaranty shall be based on the total bid for all groups or items submitted.

     If the bidder is a partnership, all partners must sign the bond or evidence in the form of a partnership agreement must be submitted showing the authority of the partner to execute the bond.

     If the bidder is a corporation, evidence in the form of a corporate resolution, authorizing the corporate representative to execute-the bona must be submitted.

     If the bidder is a joint venture, all parties to the joint venture must sign the bond or evidence in the form of a joint-venture agreement must be submitted showing the authority of the bidder to sign the bond on behalf of the joint-venture.

     Unless otherwise specified on the proposal form provided by the State proposals for the purchase of personal property need not be accompanied by a proposal guaranty.

     2.11  SWORN STATEMENT - Each bidder shall accompany his/her bid with a swornstatement that he/she, and the organization or entity he represents, has not been a party to any agreement or collusion among bidders or prospective bidders in restraint of competition.

     2.12   DELIVERY OF PROPOSALS - The proposal shall be placed together with the proposal guaranty, in a sealed envelope so marked as to indicate the identity of the project, the project number, the date of bid opening and the name and address of the bidder and then delivered as indicated in the Advertisement for Bids. Proposals will be received up to the time fixed in the public notice for opening of bids and. must by that time be in the hands of the official indicated. The words "SEALED BID" must be clearly written or typed on the face of the sealed envelope containing the proposal and proposal guaranty.

     2.13    WITHDRAWAL OR REVISION OF PROPOSALS - Any bid may be withdrawn or revised at any time prior to, but not after, the time fixed in the public notice for the opening. of bids, provided that a request in writing, executed by the bidder or his/her duly authorized representative, for the withdrawal or revision of such bid is filed with the Contracting Officer before the time set for the opening of bids. The withdrawal of a bid shall not prejudice the right of a bidder to file a new bid. Whether or not bids are opened exactly at the time fixed in the public notice for opening bids, a bid will not be received after that time, nor may any bid be withdrawn after the time fixed in the public notice for the opening of bids.

     2.14    PUBLIC OPENING OF PROPOSALS - Proposals will be opened and read publicly at the time and place indicated in the Advertisement for Bids, or as soon thereafter possible. The time set for the opening of sealed bids will not be less than thirty (30) days following final publication of the advertisement for bids. Bidders, their authorized agents and other interested parties are invited to be present.

     2.15   DISQUALIFICATION OF BIDDERS Anyone or more of the following causes maybe considered as sufficient for the disqualification of a bidder and the rejection of their proposal or proposals:

  a.      Failure to comply with any of the requirements in these regulations which relate to the qualifications of bidders;
 
  b.      Evidence of collusion among bidders;

  c.      Lack of responsibility and cooperation as shown by past work;

  d.      Being in arrears on existing contracts with the State of Yap, or having
           defaulted on a previous contract:
 
  e.     Lack of proper equipment or sufficient experience to perform the work
          contemplated, or lack of sufficient financial ability;

  f.      No contractor's license or a contractor's license which does not cover
          type of work contemplated;

  g.      More than one proposal for the same work from an individual, firm, partnership, corporation or joint venture under the same or different name;

  h.      Delivery of bids after the deadline specified in the advertisement calling for bids;


   i.       Failure to pay, or satisfactorily settle, all bills overdue for labor and materials of former contracts in force at the time of issuance of proposal forms; or

   j.      Any disclosure in advance of the terms of a bid submitted.

     The Contracting Officer may in good faith also disqualify a bidder for reasons other than those listed above when he/she determines it to be in the public interest to do so.

     2.16   REJECTION OF PROPOSALS - Proposals will be considered irregular and may be rejected for any one or more of the following reasons:

  a.      Failure to comply with any of the material requirements in these regulations which relate to the submission of proposals;

              b.     The proposal is unsigned;

  c.      The proposal guaranty is not in accordance with Subsection 2.10;

  d.      The proposal is on a form other than that furnished by the State, or the form is altered or any part thereof;

   e.      The proposal shows any non-compliance with applicable law, additions not  called, conditional bids, incomplete bids, uninitiated erasures or other   defects, or if the-prices are obviously unbalanced; or if sufficient funds are  not available to prosecute the work;

    f.      The bidder adds any provisions reserving any rights pursuant to an
            award.
 
    g.    The proposal is not signed by the proper person in the manner
            required, or the bidder fails to submit the necessary documentation to
            show that the person who signed the bid was duly authorized; or

     h.    There is an incomplete or ambiguous listing of joint contractors or subcontractors, which has not been cured in a timely fashion as provided in these regulations.

     The Contracting Officer may in good faith also reject a proposal for reasons other than those listed above when he/she determines it in the public interest to do so.

     2.17   NO BIDS - If no bids are received, the state may complete the project without further compliance with these regulations or Yap State Law No. 1 -215.

     2.18    EMERGENCIES - In case of an emergency affecting public health, safety or convenience, so declared in writing by the Governor upon application by the head of any State Government Agency setting forth the nature of the emergency aid the danger to the public health, safety or convenience caused by delay, contracts may be awarded or let to the extent necessary to meet the emergency without public advertisement. Such action and the reasons therefor shall be made public immediately by the Contracting Officer.


SECTION 3
AWARD AND EXECUTION OF CONTRACT

     3.1  CONSIDERATION OF PROPOSALS - After the proposals are opened and read, the bids will be compared and the results of such comparison shall immediately be made public. In the comparison of bids words written in the proposals shall govern over figures and unit prices shall govern over totals. The State reserves the right to waive any defects or technicalities as may be deemed in the best interest of the State.  

     3.2  CITIZEN BIDDER PREFERENCE - Citizen bidders who qualify to bid shall receive preference over noncitizen bidders in determining the award of the contract as described below.
 
     In order for a bidder to be eligible to be considered for the citizen-bidder preference the following criteria shall be satisfied as determined by the Contracting Officer:

  a.      The bidder shall include in his/her bid a that the bid is being submitted as a citizen bidder;

  b.      The bidder is a resident of the State of Yap for at least five (5) years prior to the submission of the bid;

  c.      At least a substantial percentage of the bidder's labor force are Federated States of Micronesia citizens and are Yapese by birth or have resided in the State of Yap or at least two (2) years immediately prior to the submission of the bid; and

  d.      The bidder, be it a corporation, joint venture or partnership, shall be at least fifty-one (51) percent owned by a citizen or citizens of the Federated States of Micronesia.

     3.3    AWARD OF CONTRACT - The State of Yap reserves the right to reject any and all of the bids submitted. The award of contract, if it is awarded, will be made to the lowest responsible bidder whose proposal complies with all the requirements prescribed, except that the bid of a noncitizen shall be considered in the selection and determination of the lowest responsible bidder only if the amount of the bid of the noncitizen bidder is at least ten (10) percent lower than the amount of the bid of the lowest citizen bidder. If two (2) or more bids are the same and the lowest, the Contracting Officer may accept the one (1) he/she choses. If no bids are received, the Contracting Officer may have the project done without further resort to the bidding process. The award of the contract will be made within sixty (60) consecutive calendar days after the opening of the proposals, but in no case will an award be made until all necessary investigations are completed. The successful bidder will be notified by letter mailed to the address shown on the proposal that his/her bid has been accepted and that he/she has been awarded the contract.

     3.4   WRITTEN CONTRACT AND CANCELLATION OF AWARD - All contracts shall be in writing and shall be executed by the Contracting Officer and made with the lowest responsible bidder, or his/her alternates if need should arise. After determining the lowest responsible bidder, the Contracting Officer at his/her discretion may negotiate with the bidder, and that bidder only, to reduce or change the scope of the work and to execute the contract at a price which reflects the reduction in the scope of work. The State of Yap reserves the right to cancel the award of any contract at any time prior to the execution of said contract by all parties, without any liability to the awardee or any other bidder.

     3.5    RETURN OF PROPOSAL GUARANTIES - All proposal guaranties, except-those of the three (3) lowest bidders, will be returned immediately following the opening, checking and evaluation of the proposals. The successful bidder's proposal guaranty will be returned after a satisfactory contract bond has been furnished and the contract has been executed. The retained proposal guaranties of the remaining two (2) lowest bidders will be returned within seven (7) working days following the execution of the contract.

     3.6    REQUIREMENT OF CONTRACT BOND - The Contracting Officer may, n his/her discretion, require that the successful bidder file a surety bond conditional on the performance of the contract. If a contract bond is required, the  form and amount of the bond must be indicated by the Contracting Officer.

     At the time of the execution of the contract for a construction project of one hundred thousand dollars ($100,000), or more, the successful bidder shall file a good and sufficient surety bond conditioned on the full and faithful performance of the contract in accordance with the terms and intent thereof, and also for the prompt payment to all others for all labor and materials furnished by them to them and used in the prosection of the work provided for in such contract, in manner, form and amount required by Contracting Officer which bond shall be in an amount equal to fifty percent (50%) of the contract or any greater amount indicated by the Contracting Officer in the proposal form. Such bond shall also by its terms insure to the benefit of any and all persons entitled to file claims for labor performed or materials furnished in the work.

     If the surety on any bond is other than a surety company authorized to do business under the laws of the State and the National Government, the Contracting Officer shall also require such surety or sureties to severally deposit with him/her certified checks or certificates of deposit, bonds, stocks or other negotiable securities, or execute and deliver to him/her a deed or deeds of trust, all of such character as shall be satisfactory to the Contracting Officer, and each surety shall furnish such security to the full cash value of fifty percent (50%), or such greater amount that the Contracting Officer may require, of the amount for which he/she shall have justified. The contract bond will not be required for awards totaling less than one hundred thousand dollars ($100,000.00), or for State contracts other than construction projects, unless otherwise indicated.

     3.7    EXECUTION OF THE CONTRACT - The contract shall, be signed by the successful bidder and returned, together with a satisfactory contract bond, if required, within fourteen (14) consecutive calendar days, after the bidder has received his/her,contract for execution or within such further time as the Contracting Officer may allow. No proposal or contract shall be considered binding upon the State until the contract has been fully and properly executed by all parties thereto, the Attorney General has certified by signature thereon that the contract is legal on its face, and the Chief of Finance has endorsed thereon his/her certification that there is an available unexpended appropriation or balance of an appropriation over and above all outstanding contracts sufficient to cover the amount committed to by the State under the contract.

     On any individual award totalling less than ten thousand dollars ($10,000.00), the State reserves the right to execute the contract by the issuance of a State Purchase Order. Acceptance shall result in a binding contract between the parties without further action by the State. Executing the contract Purchase Order shall not be deemed a waiver of these specification requirements.

     3.8    FAILURE TO EXECUTE THE CONTRACT - If the Bidder to whom a contract is awarded shall fail or neglect to enter into the contract and to furnish the required security within fourteen (14) consecutive calendar days after such award or within such further time as the Contracting Officer may allow, the award shall be cancelled and the proposal guaranty shall be declared forfeited. The proposal guaranty shall thereupon become a realization of the State, not as a penalty, but in liquidation of the damages sustained. The Contracting Officer may thereupon award the contract to the next lowest responsible bidder or may call for new bids, whichever method he/she may deem is to the best interest of the State.

      3.9   NOTICE TO PROCEED - After the contract for a construction project is fully
and properly executed under conditions specified above, the Contractor will be sent a formal "Notice to Proceed" advising the Contractor of the date on which he/she may proceed with the work. The Contractor shall be allowed fourteen (14) consecutive working days from said date to begin his/her work. In the event that the Contractor refuses or neglects to start the work, the Contracting Officer may terminate the contract. In the event that the Contractor desires to commence his/her operations prior to receipt of notice to proceed, he/she must, in writing, seek authorization from the Contracting Officer: Should the Contractor begin work on the project before receiving the Notice to Proceed, and without written authorization from the Contracting Officer, any work performed will be at his/her own risk, and he/she shall be liable for any consequences which flow therefrom. Under no circumstances shall the Contractor commence construction operations until he/she has notified the Contracting Officer of his/her intentions and has been advised by the Contracting Officer in writing that the project site is available-to the-Contractor.

     3.10    TERMINATION OF CONTRACT - The Contracting Officer may terminate the contract at any time when, in the opinion of the Contracting Officer, the Contractor has made unjustifiable and substantive changes from the terms and conditions specified in the contract. Upon such termination, the Contracting Officer shall limit payment to the Contractor to that part of the contract satisfactorily completed at the time of the termination.

     3.11    ASSIGNMENT OF CONTRACT - No contract awarded to the lowest responsible bidder shall be assigned by the successful bidder without the written consent of the Contracting Officer.
                                                                                                                                                                                                                                                                                                           
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