Shiawassee County Housing Rehabilitation Program

Excerpts of the Program Policy

And General Guidelines For The

Community Development Block Grant (CDBG) Loan Program

And

MSHDA’s Property Improvement Program (PIP)

Revised April, 1999

Shiawassee County will not discriminate against any contractor on the basis of race, creed, sex, color, religion, national origin, or handicap for participation in the Housing Rehabilitation Program.

Participating contractors are screened for unresolved complaints or disciplinary actions through the Michigan Consumer and Industry Service, Licensing Division for Builders or the Michigan Department of Labor, Bureau of Construction Code. They will also be required to supply the Program Office with a copy of a valid Michigan Residential Builders’ license and proof of current liability and Worker’s Compensation Insurance as required by law. Other pertinent company information may be required for new contractors participating in the program. However, the Program Office nor its Staff can guarantee the workmanship of any contractor.

Approved contractor names will be included on a list of available contractors which is given to each program participant as a reference source. Homeowners are required to select their own contractors to obtain cost estimates for required work. Contractors selected which do not appear on the listing will be required to supply the information noted above. New contractors are always welcome for inclusion on the availability listing.

A Scope of Work, prepared by the Program Office with input from the homeowner, will be presented to the contractors providing estimates by the individual homeowner. THIS IS TO BE USED AS A BASIC GUIDE FOR WORK TO BE COMPLETED AND IS NOT A DETAILED ITEMIZATION OF HOW TO DO THE WORK. Estimates are to be developed in detail from the Scope of Work by the contractor and returned in writing to the owners or the Program Office within 30 days.

All contractors are required to attend a pre-construction meeting prior to the start of construction involving the homeowner, contractor and program staff. At this meeting, staff will review program procedures and a construction contract will be signed.

The construction contract includes numerous clauses which fall into four general categories:

1. Items relating to the mechanics of contractual arrangements between the contractor and homeowner.
2. Various guarantees made by the contractor to protect the interests of the homeowner and the program. Foremost of these is a one-year warranty on materials and workmanship.
3. Sections including nondiscrimination statutory requirements for equal opportunity.
4. Sections outlining how construction activity is to be carried out and referencing the bid and the job specification.

Construction activity CANNOT begin until a "Notice to Proceed" letter is issued. This notice will be signed by the Program Administrator and will be issued when all legal and financial details have been completed. This includes the three (3) day period after contract signing when the homeowner has a right to rescind the contract. Work can begin as of the date stated in the "Notice to Proceed." Contractors will generally be given 60 days to complete the work.

It will be the responsibility of the contractor to obtain all necessary building permits for each project and submit proof of such to the Program Office prior to payment. Permit fees should be included in the cost estimate. The contractor is responsible for contacting the respective building agencies for all inspections required by each permit. The contractor must also notify the Program Office when progress and final inspections are needed for issuing payments. It is important to distinguish that permit issuing agencies will inspect to assure code compliance and the Program Staff will assure compliance with the Scope of Work.

According to the disbursement schedule, contractors may submit to the Program Office invoices for payment accompanied by lien waivers from all subcontractors and suppliers. Upon project completion, the contractor must also prepare and submit a sworn statement that all obligations are met or that the final payment forthcoming will discharge all obligations relating to the job. Funds will be released upon homeowner’s authorization and inspections by the program staff.

Change orders must be initiated by the homeowner. They must submit a written estimate from the contractor along with an explanation of the reason for the request for change. All change orders will be reviewed by the Program Administrator and/or the Advisory Board. Change orders shall be accepted if they meet the following conditions:

1. The items being changed were not previously included in the Scope of Work/Specifications.
2. The Change Order is being requested to address an issue or item that was not apparent in the initial bid process but will have a strong affect on the successful outcome of the rehabilitation. Examples might include removing wall board to find a portion of the wall is not insulated or has excessive water damage that causes structural weakness; window replacement reveals water damage in the wall that was not apparent; a new money saving product has become available; the homeowner and contractor have found a different method of completing a specification that saves money and/or time
3. The Change Order cannot add more than 5% of the total cost of the rehabilitation project; however, it can decrease any amount of the rehabilitation project so long as all conditions of the source of funding are met.

Repeated substandard performance of work by a contractor which is documented by the Program Office will result in the contractor’s debarment and subsequent ineligibility to participate in Shiawassee County’s Housing Rehabilitation Program for three (3) years. After this time, a contractor who has been disbarred from program participation may request reconsideration. Credentials required above must be resubmitted along with sufficient proof that the problems which originally caused the debarment have been eradicated from the company’s business practices prior to re-admittance to active status with the Housing Rehabilitation Program.

A contract will be terminated with a contractor and the balance of the contract will be awarded to another bidder when the contractor violates the conditions of the contract or does not perform work according to the agreed upon schedule.